e-cheque

the new service given to the customers of commercial banks in order to ease their banking activity under e-banking system. it also a step towards green banking

1. WELCOME

2. E-CHEQUE

3. E-CHEQUE
Recent years have seen a tremendous increase in
e-commerce transactions. The success of e-
commerce relies on developing adequate
payment technologies. One such technology is
e-Cheque. An e-
Cheque is an electronic document which
substitutes the paper check for online
transactions. Digital signatures (based on public
key cryptography) replace handwritten
signatures.

4. Definition of 'Electronic
Cheque'

A form of payment made via the internet that is
designed to perform the same function as a
conventional paper cheque. Because the cheque
is in an electronic format, it can be processed in
fewer steps and has more security features than
a standard paper cheque. Security features
provided by electronic cheque include
authentication, public key cryptography, digital
signatures and encryption, among others.

7. The e-Cheque is compatible with interactive web
transactions or with email and does not depend on
real-time interactions or on third party
authorizations. It is designed to work with paper
cheque practices and systems, with minimum
impact on payers, payees, banks and the financial
system.
Payers and payees can be individuals, businesses, or
financial institutions such as banks. E- Cheques are
transferred directly from the payer to the payee, so
that the timing and the purpose of the payment are
clear to the payee

8. The payer writes an e-Cheque by structuring an
electronic document with the information
legally required to be in a cheque and digitally
signs it.
The payee receives the e-Cheque over email or
web, verifies the payer's digital signature, writes
out a deposit and digitally signs it.

9. The payee's bank verifies the payer's and payee's
digital signatures, and then forwards the cheque
for clearing and settlement
The payer's bank verifies the payer's digital
signature and debits the payer's account

10. PAYER PROCESS
In order to send a cheque, the client simply
fills out a standard e-cheque. The system
allows clients to define common payees in
order to speed the e-cheque creation process.
When the cheque has been written it can be
easily transferred from the payer to the payee
over a secure e-cheque channel.

11. This secure channel will be established
between the payer and the payee before the
transaction begins.
The e-cheque is automatically signed by the
user using his private key based on RSA
algorithm and SHA-128; this ensures the
authenticity and the integrity of the e-cheque

12. PAYEE PROCESS
When the payee receives the e-cheque he can
open and view it using the e-cheque system.
In order to deposit the cheque, the payee
simply connects to the bank (which is
expected to provide e-cheque services) and
uploads the e-cheque to his bank account.

13. Once the bank receives the e-cheque, it will
decrypt it using the e-cheque system.
 After clearing (i.e. verifying both the cheque
signature and account balance) with the
payer’s bank, the payee’s account will be
credited accordingly.

15. BENEFITS OF E-CHEQUE
 TO CUSTOMERS;
No physical movement of cheques so no fear of
loss of cheque in transit.
Quicker clearance; within 3-4 working days.
Its more secured than physical cheques.
Decrease errors and fraud. eCheques reduce the
potential for errors and fraud because fewer
people handle them.
They can serve corporate markets. Firms can use
them in more cost-effective manner

16. Benefits to Bank
Reduce the risk associated with paper clearing
Superior verification and reconciliation process
No geographical restrictions
No physical movement of cheques- it saves cost
and time for banks.
No chance of cheque dishonor- The risk is taken
care of by the accounting server, which will
guarantee that the cheque would be honoured.

17. Well suited for clearing micro payments
Reduce processing costs by up to 60%. E-
cheques require less manpower to process
and don’t come with any deposit or
transaction fees. As a result, processing an e-
cheque is generally much cheaper than
processing a paper check or credit card
transaction.

18. Work smarter and greener.; Electronic check
conversion is easy to set up. It relies on the
trusted ACH Network. And eChecks help
reduce the more than 67.4 million gallons of
fuel used and 3.6 million tons of greenhouse
gas emissions created by transporting paper
checks
ACH – Automated Clearing House.

19. DRAW BACKS
 Customer education
Chances of misuse, hacking etc
Need a different infrastructure
Unauthorized transactions becomes
challenge for banks

20. Problem could be when there is more than
one signer or endorser.
Transactions based on internet- network
failure may lead to delay in payment.
Both payer and payee should have e-cheque
facility.

21. In India the e-cheque facility is now replaced
by CTS- Cheque Truncation System 2o1o.
Where there will be a physical cheque which
will be converted into e-cheque by scanning
and transferred for clearance. And the time
taken for clearance is 24hrs.

22. THANK
YOU>>>>>>>>