Circular on Returned Cheques for Financial Reasons During the Suspension Period

10/5/6410
17 /10/1441 AH
9 / 6 /2020 AD

Circular to Licensed Banks
Subject: Returned Cheques for Financial Reasons During the Suspension Period

Greetings,

With reference to the above subject, and following our circular No. (10/5/6069) dated 3/6/2020, the following amendments are approved and reflected in the attached Guideline for Banks on how to report returned cheques during the coronavirus pandemic, as follows:

Reliance on time periods (days of the week) instead of working days regarding the mechanism for calculating the grace period for returned cheques during the exceptional period of the coronavirus pandemic, which starts from 26/2/2020 until 31/12/2020, as follows:

• Period One: from 26/2/2020 to 4/4/2020.
• Period Two: from 5/4/2020 to 30/4/2020.
• Period Three: from 3/5/2020 to 21/5/2020.
• Period Four: from 26/5/2020 to 31/12/2020.

Banks are required to report returned cheques during the suspension period resulting from the coronavirus pandemic no later than 31/10/2020 for Periods (1-3); otherwise, the bank is considered in violation of the prevailing instructions. Regarding returned cheques during the fourth period, banks are required to report these cheques immediately after the expiration of the grace period granted for that period.

It is prohibited to collect any commissions on returned cheques or on any settlement made for those cheques (whether the settlement is within the grace period or after it) during Periods (1-3), whether the cheque was presented once during the aforementioned periods or was re-presented and presented again after 26/5/2020.

As for cheques that were re-presented within the fourth period, an amount of (5) dinars is to be collected as a commission for any returned cheque and (5) dinars commission for any settlement made by customers (whether the settlement is within the grace period or after the grace period).

Article (15) of our instructions No. (55/2011) dated 24/10/2011 is amended to read as follows:

"In the event the Unit receives the settlement file stipulated in paragraph (a) of Article (9) of these instructions, the client's name is to be removed from the Unit's list after one month has passed from the date of settlement, regardless of the number of returned cheques against the client."

The instructions for the Returned Cheques Unit will resume their usual operation effective from 3/1/2021.

Please accept our highest respect,

The Governor
Dr. Ziad Fries

Attached: Guideline for Banks on how to report returned cheques during the coronavirus pandemic.
Amended circular to licensed banks regarding returned cheques for financial reasons / O.Sh