A new system will be introduced soon by banks to evaluate the creditworthiness of those applying for checkbooks, a lawmaker said admitting that the existing ways and means are not up to the mark.
"The present platform lacks several key features such as issuance of checks for collateralization or as guarantee. Moreover, for the elderly and those who do not have smart phones it is difficult to use of the system
It also does not block the deposits of those whose checks are rejected," Abolfazl Aboutorabi was quoted as saying by Fars News Agency.
The new system is to set a cap for the maximum value of checks that each person is allowed to issue. "The cap will be set based on the Central Bank of Iran's assessment of checkbook holders' creditworthiness.
"Checkbook holders' income, their financial record and their assets will be the primary criteria in CBI's assessments," Aboutorabi said.
However, state organizations need to work in tandem to enable the CBI to effectively implement the system, the MP said.
"We are hopeful that the mechanism will be ready by the next fiscal year [begins in March].
The new check issuance and operational rules are designed to improve transparency in banking transactions by obliging check holders to register data on CBI electronic platforms.
The CBI has an integrated electronic system and streamlined electronic check-processing platforms, namely ‘Sayyad’ and ‘Chekavak’, for digital checks.
Sayyad runs a credibility check on account holders wanting to write a check. Chekavak is an electronic check processing system that eliminates the physical circulation of checks and improves credibility verification.
The Sayyad system is accessible to check holders via banks’ internet gateways as well as cellphone applications.
Check issuers are required to register data such as date of issuance, amount and identity of the beneficiary on special check portals.
CBI says check payments have improved in the past six months after the new check law came into effect, as per which bad checks declined 17.9% in volume in the month to Sept 22.
