OF CHEQUES & STOP PAYMENT INSTRUCTIONS
has been observed that some banks give ambiguous reasons
like ‘refer to drawer’ when a cheque is returned
unpaid by them for insufficient balance or for any other
reason. As a result, the beneficiary of the cheque is not
in a position to take action against the issuer of the cheque
under the provisions of relevant laws.
Similarly, banks while responding to the cheque “stop
payment written instructions” from their customers,
issue disclaimers for indemnifying themselves against breach
of these instructions, which negates the very purpose of
the stop payment instructions.
order to discontinue the above practices, banks/DFIs are
advised to (a) give a specific and clear reason for dishonouring
the cheque, and (b) discontinue issuing of disclaimer for
indemnifying themselves against any breach of stop payment
instructions from their customers.
4. Banks/DFIs are advised to comply with the above instructions
meticulously. State Bank of Pakistan, during the course
of regular inspections, would particularly check the compliance
of the above instructions as a part of its consumer interest
protection responsibilities. Non-compliance, thereof, will
attract penal provisions under Banking Companies Ordinance,