Introduction to Cheque and Draft Issue Management

A cheque (or check) is an instrument that orders payment of money from a bank account. The person writing the cheque, the drawer, usually has an account with a bank where the money was previously deposited. The drawer writes various details (including the amount, date and a payee name) on the cheque and signs it, ordering the bank (known as the drawee) to pay that person or company, the amount of money stated.

A Demand Draft (DD) is a negotiable instrument issued by the bank, similar to a bill of exchange. Bank issues a DD to a client, directing another bank or one of its own branches to pay a certain sum to the specified party.

Product Configuration

The first step in cheque or draft issue management involves managing the stock. This is common for banker’s cheque, drafts, fixed deposit receipts and credit cards as well as cheques issued to customer accounts.

For cheques, it is possible to record receipt of stock, receiving requests for cheque book from customers, sending a cheque for further local printing and actual issue to customers.

The following flowchart shows the process of stocking and issue of cheque or draft.

The following flowhcart shows the cheque stocking and issue process in Temenos Transact.

Illustrating Model Parameters

The high-level configurations available in the Model Bank are given below:

S.No	Parameter	Description
1.	STOCK.PARAMETER	Allows the user to create and maintain different types of stocks such as cheques, bankers cheques, drafts, fixed deposit receipts, and credit cards.
2.	STOCK.ENTRY	Allows the user to record inward and outward printed stock of stationeries such as cheque and fixed deposit receipts. Details such as cheque type, stock series, stock start number, stock quantity, and stock account number are captured.
3.	STOCK.REGISTER	Helps the user to view details such as Stock Register ID, Series ID, Stock Start No, and balance stock.
4.	CHEQUE.TYPE	Allows the user to define the types of cheques supported by the cheque control system.
5.	CHEQUE.STATUS	Allows the user to define various types of cheque statuses issued in the Cheque Issue application.
6.	CHEQUE.CHARGE	Allows the user to define the charging structure to be applied to all cheque types for issues and periodic usage charges.
7.	PAYMENT.STOP.TYPE	Allows the user to define maximum 99 reasons for payment stop instructions such as cheque lost and cheque destroyed.
8.	CQ.PARAMETER	Allows the user to parameterise the transaction and category codes related to CHEQUE.COLLECTION application. It is referred while creating or amending records in CHEQUE.COLLECTION and also helps to define whether account or cheque currency to be considered for raising suspense entries account.

Illustrating Model Products

Different CHEQUE TYPE available are listed below:

Cheque type	Description
SB	Savings Bank Account Cheques
CURR	Current Account Cheques
DD	Demand Drafts or Managers Cheques