More than 41,000 automated teller machines across the country are now connected to the Central Bank of Iran's Sayyad system that allows account holders to register checks and assess the credibility of issuers merely by scanning them.
According to the CBI website, major banks have the largest network connections, such that the service could be used by bank customers throughout the country.
According to Mehran Moharramian, CBI's deputy for innovative technologies, ATMs owned by 20 banks are already connected with the Sayyad system.
"These lenders own about 70% of the ATM machines in Iran … The remaining eight banks are also required to prepare the grounds for offering the service," IRNA quoted him as saying on Wednesday.
At present, the service can only be used for handling checks that are printed by the same bank that owns the ATMs. However, the plan is to expand the scope of the service so that all checks could be handled by ATMs regardless of the bank owning it.
Measures against bad checks were made into law in 2018, as part of the amendments to the Check Issuance Law.
That year, the parliament gave CBI, as the body in charge of enforcing check laws, two years to prepare the infrastructure to implement the law.
According to the latest figures, checks rejected in the month ending April 20 declined by 37.6% from the earlier month to reach 207 trillion rials ($690 million).
In terms of numbers, they stood at 471,000, down 24.2% in one month. In terms of volume and value, bad checks accounted for 9.1% and 11.2% of all drawn checks in the month, respectively.
Compared with the corresponding month of the last fiscal year, when the new check law came into force, the number of rejected checks dropped by 24.2%.
A key aspect of the new law is that it pursues the goal of launching electronic checks and gradually eliminating physical checks. CBI has managed to implement digital checks, after designing an integrated electronic check system, and streamlined electronic check-processing platforms, namely Sayyad and Chakavak.
Sayyad is a system designed to run a credibility check on account holders wanting to write a check. Chakavak is an electronic check processing system for eliminating the physical circulation of checks and improving the credibility of checks.
As per the provisions of the law dubbed "Amendment to Check Issuance Law", if a bad check is definitive due to insufficient funds, courts are authorized to seize the amount from other assets of the check’s signatory. The amended law has also set penalties for those who acquire a checkbook through fraud and for bank staff who violate the law.
Depriving checkbook-holders the right to bank loans and other financial facilities are also enshrined in the amended law. Access to checkbooks will become difficult and the credibility of applicants will be verified beforehand.
