Times have changed and also newer technology has come in all the fields, the same is with the Banking industry.
Yesterday a new MICR cheque processing centre and Bankers clearing house run by the Union Bank of India (UBI) was inaugurated yesterday by Mr.Mohindar Kumar, Dy.General Manager RBI & Mr.K V A Balaji Registrar of VTU presided over the function.
Till date the bankers clearing house in Belgaum was run by the SBI at its Kirloskar road branch and from today the clearing will done by UBI at its new MICR centre at Khanapur Road behind Lengade Hostel.
More about clearing house:
The place where the exchange of instruments occurs and the claims are settled is known as the Clearing House.
In India, the clearing system is local and confined to a defined jurisdiction covering all the banks and branches situated in the area under a particular zone. The clearing house is a voluntary association of banks under the management of a bank where the settlement accounts are maintained. Wherever Reserve Bank of India has its office (and a banking department), the clearing house is managed by it. In the absence of an office of the Reserve Bank, the clearing house is managed by the State Bank of India, its associate banks and in a few cases by public sector banks.
The membership of the clearing house includes both direct members and sub-members. All the branches of a member bank within the clearing house jurisdiction are eligible to present and receive cheques drawn on any other member bank/branch within the jurisdiction. The sub-members, who are sponsored by a member bank, participate in clearing in the same way as a branch of a member bank. The membership to the clearing house is through a joint decision of the general body of the clearing house.
Clearing Structure: The dominant feature of the Indian Banking system is its branch-centered banking. The vast network of branches implies that the logistics of collection and delivery of paper payment instruments becomes formidable. The clearing infrastructure is designed to address the movement of instruments between the presenting and drawee branches. Each member bank in a centre is represented in the clearing house by its service branch which collects all the instruments from various branches and consolidates them for presentation to all the banks in the clearing house. Similarly, it receives and distributes among its branches all the instruments drawn upon its branches by other banks in the clearing house. The service branch of a bank performs a crucial intermediary role between the clearing house and the branch of a bank.
If you want to know more about this clearing methodology read this.