Do banks understand the clearing cycle?
The Banking Code Standards Board have published the results of their mystery shopping to see how many banks understood the impact of the 2-4-6 cheque clearing process. They found there is confusion among bank staff. They looked for the ability of bank staff to provide clear and accurate information about cheque clearing times. They also checked whether banks had changed their terms and conditions to bring them into line with the new clearing rules. In November 2007, the Cheque and Credit Clearing Company standardised maximum cheque clearing times. This was to help customers know how quickly they could benefit from interest on cheques paid in, how soon underlying funds could be withdrawn and when they could be certain a cheque would not be returned unpaid. Only one bank provided correct information on all the tests. At the other end of the scale, a bank gave wrong answers in nearly 60% of cases. The main area for confusion was calculating the day on which a cheque would not be returned unpaid (certainly of fate). Some staff gave a description of the clearing cycle before the 2-4-6 changes were implemented. One bank quoted an 8 day clearing cycle. Two banks had not advised customers of the changes to the terms and conditions on their accounts.
Bank Law Blogger posted on 2-4-6 in November 2007.
