Central Bank of Belize to introduce new Automated Cheque Processing

Thursday, July 6th, 2017

On Tuesday, July 4th, the Central Bank of Belize announced their plans to launch ‘Automated Cheque Processing’, which is a new component of the Automated Payment and Securities Settlement System (APS3). Starting on Friday, July 7th, all cheques deposited countrywide will now be processed electronically, allowing for faster clearing time. As APS3 seeks to reform Belize’s national payment system, it provides the groundwork to facilitate the electronic transfer of funds domestically, for both large and small value payments, including an instant funds transfer feature.
Through APS3, financial institutions are connected in a local network, which will enable banks to provide customers with services to make electronic payments quickly, safely, and securely anywhere in Belize. This project provides a wider range of payment options such as (1) Electronic Funds Transfer (EFT) for low-value payments (which includes bulk payments, such as payroll and accounts payable) within the same day, (2) Instant Funds Transfer (IFT) (an electronic payment that is available 24/7) within a few minutes, (3) Real-Time Gross Settlement (RTGS) for high value payments within an hour, and now (4) automated clearing and processing of cheques by the end of the next day.
The automated cheque processing service will transform the entire procedure from deposit of cheques at participant banks to clearing and settlement via APS3. Now, cheques presented to banks by customers countrywide before 2PM, will be scanned and sent to APS3 on the same day (T) and credit will be applied at the end of the next day (T+1). Before automation, deposited cheques took several days to clear—three days for local cheques and seven days for out-district cheques. According to Governor of Central Bank, Joy Grant, this new service will further expedite the flow of money, contributing to faster receipt of funds by beneficiaries and increased business activity in Belize.
Rabey Cruz, Director of Information Technology, Central Bank of Belize, explained that banks had enough time to prepare for this new processing. “In 2015, we finished a request for the proposal, and the banks were a part of that. We signed a contract with Montran in 2015 and from then onwards, banks knew what they would have to do to get to be ready; in terms of developing formats to be able to support high value payments, formats for low value payments, formats for IFT, [and] formats for cheques. Some of them probably started…every bank had to customize their back office. Every bank had to prepare for this system for October. So they had to develop first the straight through processing, meaning that they can send payments, receive payments of all these formats to the system and receive them as well,” said Cruz.
Hollis Parham, Director of Finance, Central Bank of Belize, stated that fees will be applied.
“What I can definitely say is that Central Bank will be charging the participants, which are the banks. Central bank will charge them at the end of the month, and we do anticipate that banks will want and seek to recover some of these fees. There are numerous ways the banks can do that, but specifically, these are fees the Central Bank is charging to a participant bank for using the APS3,” said Parham.
Sherie Smiling Craig, Director of Project Management, Central Bank of Belize, ensures that screening will be done as is mandated by law to avoid risks of money laundering and cyber-attacks. “In the law, we have the requirements for participation in the system. And the law sets out clearly what the requirements are and then the Central Bank will assess how those are satisfied before granting any kind of licensing for another entity to be a participant in the system. We also have to be considerate of the risk factor that any player will bring anyone. So we are always aware, and that is why the law is so structured,” said Craig.
The Central Bank of Belize was established on January 1, 1982 and is guided in all its actions by the objective of fostering monetary stability that promotes the growth of the economy of Belize. For more information regarding this new product, members of the public should call 223-6194 or email sheree.craig@centralbank.org.bz

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