Regulatory Alerts2013-03-06 | SGDB N° 010/2013Added · Updated
SGDB No. 010/2013: Characteristics of Check Forms and Security Elements
The Central Bank of Bolivia mandates that authorized financial intermediaries comply with specific technical dimensions, MICR printing standards, and security features for all check forms. Financial institutions must implement these requirements within 18 months of the circular's issuance, with the implementation timeline for the validator code to be determined by the Compensation and Settlement Chambers Administrator within 90 days. The regulation defines precise specifications for paper weight, tear resistance, magnetic ink composition, and watermarks to ensure the integrity of checks as payment instruments.
[Logo of the Central Bank of Bolivia]
EXTERNAL CIRCULAR OF THE CENTRAL BANK OF BOLIVIA
La Paz, March 6, 2013 SGDB No. 010/2013
FROM: GENERAL MANAGEMENT FINANCIAL ENTITIES MANAGEMENT TO: FINANCIAL INTERMEDIATION ENTITIES AUTHORIZED TO OPERATE WITH CHECKING ACCOUNTS BY THE SUPERVISORY AUTHORITY OF THE FINANCIAL SYSTEM SUBJECT: CHARACTERISTICS OF FORMS AND SECURITY ELEMENTS OF THE CHECK
Ladies and Gentlemen:
The Central Bank of Bolivia, within the framework of its powers and in accordance with what is established in the new Check Regulation, transmits for application and compliance the characteristics of the forms and security elements that checks must meet.
Financial entities that issue checks must adapt to what is established in this Circular within a maximum period of 18 months from the date of issuance, with the exception of what is indicated in the point referred to the validator code in section 3.1 (Description of fields). The implementation period for this code will be defined and communicated by the Compensation and Settlement Chambers Administrator S.A. to financial entities and the Central Bank of Bolivia within 90 calendar days.
Sincerely,
Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia
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Characteristics of the forms and security elements of the check
The following characteristics and elements mark the minimum operational security conditions that the check as a payment instrument must meet and must be applied throughout the national territory. The following aspects are considered:
- Permitted dimensions of checks
- Free band
- MICR printing
- Security elements
1. Dimensions
Length: minimum 15.00 cm. - maximum 22.00 cm. Height: minimum 7.00 cm. - maximum 10.00 cm.
2. Free Band
It is the predetermined area along the entire lower part of the check to perform the printing of magnetic characters. It must occupy exactly 16 mm. of the lower horizontal space. Both on the front and back, the free band must not contain any other printing, dark backgrounds, logos, or texts that hinder the legibility of the magnetic characters.
3. MICR Printing Band
MICR characters must be printed within the free band. The positions of the MICR characters are considered from right to left. The magnetic character in the first position (1) must be printed with its vertical axis 8 mm from the right edge of the check, which edge must be free of any perforation. The horizontal distance between the two vertical axes of each character or MICR space must be 3.2 mm. The tolerance for spacing between characters will be 0.34 mm.
The horizontal axis of each MICR character must be within the 16 mm of the free band. For the purpose of controlling the positioning and spacing of the printed E13-B MICR characters on checks, the Xerox 4197 MICR Gauge template or equivalent will be used.
Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia
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E13b characters will be used according to the following figure:
[Image of E13b characters]
3.1 Description of fields
Validator Code. This field will use position 46 for the printing of a validator code or security digit that validates the check code and the account code. Transit (Routing Field). This field must use 11 positions and be delimited by two type A symbols.
[Image of transit field]
The first character must occupy position 45 and the last position 35.
The bank code and the code of the branch where the check was issued (both assigned by the ASFI, 5 characters for the first and 4 for the second) must be located between position 44 and position 36 inclusive.
Account number and check number. This field must use 19 characters in total and is read in two parts. The first part corresponds to the account number and is comprised between the delimiters: type A symbol (position 35) and type C symbol (position 21), corresponding to:
- Position 34 identifies the type of account or document. For identification, the following codes will be used:
- Private checking account
- Fiscal account
- Manager's check
- Position 33 identifies the currency: 0 Foreign currency and; 1 National currency.
- Positions 32 to 22 inclusive must contain the account number; these positions must be filled with leading zeros if necessary.
The second part corresponds to the check number and is comprised between the type C symbol (position 21) and the type B symbol (position 12).
- Positions 20 to 14 inclusive must be occupied by the check number; they must be filled with leading zeros if necessary.
- Position 13 must be blank obligatorily.
[Image of field scheme]
Amount or Value (Amount Field): This field must consist of 10 digits; within it, the amount for which the check was issued must appear encoded (filling unused positions on the left with zeros). This field must be delimited by two type B symbols (positions 1 and 12).
[Image of amount field]
Optionally, financial entities may use positions 11 to 2 for post-marking with the amount for which the check was drawn.
In case of making use of this option, in positions 11 to 4 inclusive, only the amount will be considered (position 4 for units, 5 for tens, 6 for hundreds, and so on up to position 11). In positions 3 and 2, cents will be considered, necessarily filled with zero if there were no cents in the check amount.
Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia
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4. Specifications of security measures
4.1 Security paper for checks It must have mechanical and surface characteristics suitable for printing with typographic, lithographic, flexographic, cryptographic, gravure, dry (toner) and semi-dry inks used in electronic impact and non-impact printers.
It must be sensitized to oxidizing, chlorinated, and organic compounds through one of the following two forms:
- Sensitized in the mass
- Sensitized on the surface
4.2 Paper specifications
Raw material: wood pulp, cotton, or both. Weight 90 g/m2 with a tolerance of +/- 5 g/m2. Tear or break resistance (Elmendorf) MD direction: 529 mN.¹ Tear or break resistance (Elmendorf) CD direction: 608 mN. Bursting resistance (Mullen): 165 kPa² Must not contain optical brighteners Free of magnetic particles Minimum reflectance of 60% Moisture of the dry paper mass between 4.7% and 5.5%. Gurley porosity 12 seconds.
4.3 Printing inks
For the printing of checks, inks of organic or inorganic pigments can be used, with varnishes according to the type of printing system used. They must be of two (2) types: a) Security inks
¹ mN= millinewtons ² kPa= kilopascals Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia
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Fugitive, water-soluble, or bleeding inks. Inks that bleed, leak, disappear, or dissolve upon contact with various erasing elements, such as chlorine derivatives and other aqueous products, must be used in the printing of the check background.
Fluorescent inks. Visible and/or invisible inks that emit ultraviolet radiation when exposed to this type of light must be used, meaning they change color or become visible when subjected to long-wave ultraviolet illumination. They will be printed in the erasure-risk zones, and therefore must be sensitive to mechanical erasures.
Numbering inks. They will be used for printing the check form number and optionally for the address and/or personalization. It must not allow adulteration by erasure or grafting. They may be penetrating or protected by fixatives, anchors, and/or special coatings.
Magnetic inks. The inks used for printing magnetic characters must meet the requirements indicated in ANSI X9.7 1988 and ANSI X9.100-20 2006 standards – Print and Test Specifications for Magnetic Ink Printing. They must contain between 50% and 60% iron oxide.
b) Conventional inks
They must withstand washing with common detergents, acids, and bases without presenting considerable color shifts, maintaining a uniform appearance. The inks must not decolorize after two (2) hours of exposure to actinic light or their normal exposure for one year, nor may they present spots or heterogeneous zones when performing printing tests.
4.4 Watermark
The check form must have a watermark, at least bitonal or duotone (light and dark watermark integrated into the same figure). It must be distributed in such a way that at least one complete watermark will be included in each check.
4.5 Front design
It must have exclusive designs of the printer. It must have the name of the printing house in which the check was printed. The colors must be of soft (pastel) tones according to the classification of the ANSI X9.7 standard.
Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia
[Logo of the Central Bank of Bolivia]
4.6 Back design or reverse
The endorsement area must be delimited and not exceed 30% of the back, justified to the right extreme when viewing the check from the back.
4.7 Optional characteristics
As an additional security measure, checks may have colored fibrils and microprinting.
Glossary
Optical brightener: Substance added to some papers to increase their apparent whiteness, characterized by reflecting an optical emission in a dazzling bluish-white tone when exposed to ultraviolet light rays.
Machine Direction (MD): Direction in which the paper runs during manufacturing, also known as grain or longitudinal direction.
Cross Direction (CD): Direction perpendicular to the machine direction in which the paper is manufactured.
Actinic light: That light which simulates natural light including the ultraviolet spectrum.
Watermark: Figure formed by the reorganization of paper fibers in some areas during its manufacturing process, either by action of a cylindrical vacuum mold or by the pressure cylinder.
MICR: Magnetic Ink Character Recognition. Printing technology that employs magnetic ink and standardized fonts (types) according to the ANSI X9 standard. This printing allows for the automated processing of documents. In Bolivia, the MICR font adopted for printing on checks is the one called “E13B”.
Security paper for checks: Paper used as raw material for the printing of check forms that contains special security characteristics that differentiate it from other common papers.
Porosity: Defined as the resistance of paper to the passage of air under a specific pressure applied to the paper. It is measured as an average time to displace 100 cc. of air through 2.5 cm2 of paper under a pressure of 12.4 cm. of water.
Reflectance: Capacity of surfaces to reflect light. The measure of reflection is reflectance; it is defined as the ratio between the reflected luminous flux and the incident luminous flux.
Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia
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Bursting resistance (Mullen): Measures the resistance of the material to applying increasing point pressure until the point where the material ends up exploding. It is expressed in pressure units.
Tear or break resistance (Elmendorf): Measures the internal resistance of the paper fibers.
Ayacucho y Mercado • Tel: (591-2) 2409090 • P.O. Box: 3118 bcb@bcb.gob.bo • La Paz - Bolivia