The Central Bank of Iran on Tuesday unveiled a new platform ‘MahCheck’ that allows withdrawal of money from defaulters' accounts in other banks.
Speaking at the unveiling ceremony, CBI Governor Ali Salehabadi said the system was created to implement the last and final phase of the check law. It is designed to help raise the reliability of checks as financial instruments, the bank's website quoted him as saying.
"Raising the credibility of checks can and should result in improving the business climate in particular and the economy in general," Salehabadi said.
"Besides, it considerably reduced the number of bad check cases referred to the judiciary during its test phase."
Measures against bad checks became law in 2018 as part of amendments to the Check Issuance Law.
That year parliament gave the CBI, as the authority responsible for enforcing check laws, two years to prepare the infrastructure to implement the law.
Based on new rules, if a check is rejected due to insufficient funds, the amount will be deducted from the defaulter’s accounts in other banks in the country, said Mehran Moharramian, the CBI deputy chief for innovative technologies.
"In the past banks could take money from a defaulter’s accounts only in the same bank…However, as of Saturday, the amount(s) will be taken from accounts owned by the writer of the check in other Iranian banks."
The new rules seek to curb bad checks, but it only blocks the amount written on the check in other bank accounts of the check writer, the official noted. "After the money is blocked, a court order is necessary to withdraw money and clear the check."
Banks have been instructed to start blocking the amount from defaulters' accounts with the highest balance. "If the deposits are not sufficient to clear the bounced check, lenders should approach the next big account(s) of debtors."
Moharramian added that a bank will only block the bounced check amounts in the check writer’s accounts.
He elaborated on Mahcheck's performance during the test phase. "During the 3-month test phase, the system handled 1.1 million bounced checks. So far 2.5 million bank accounts of issuers of 170 trillion rials worth of bad checks have been blocked.”
Mohammad Kazemifard, the judiciary’s deputy for IT affairs, expressed optimism over the positive impact of MahCheck on the quality of work by the justice-dispensing system.
"The platform has provided the judiciary access to defaulters' bank accounts, which can help support the rights of the people."
A key aspect of the new law is launching electronic checks and gradually eliminating physical checks. The CBI has managed to implement digital checks, after designing an integrated electronic check system and streamlined current electronic check-processing platforms, namely Sayyad and Chekavak.
Sayyad is a system designed to run a credibility check on account holders wanting to write a check. Chekavak is an electronic check processing system for eliminating the physical circulation of checks and improve the credibility of checks.
