Regulatory Alerts2002-01-01
Bank of Zambia Directives on Unpaid Cheques
The Bank of Zambia directs all commercial banks to implement strict measures to minimize unpaid cheques drawn against insufficiently funded accounts and restore confidence in the national payment system. Banks must tighten customer vetting and chequing account approvals, mandate account closure after three unpaid cheques in a calendar year, establish a uniform punitive minimum charge for returned cheques, and replace the "Effects Not Cleared" status with "Refer to Drawer". Additionally, institutions are required to submit monthly returns of unpaid cheques to the regulator and face significant financial penalties for non-compliance, with all directives taking effect on 1 November 2002.
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