Domestic

Cheque truncation clearing

Asha Rao deposits a paper cheque written by Demo Trading Ltd. Northstar Bank captures the image and truncates the paper, Cheque Clearing Co exchanges the image, Bank Alfa checks the drawer's funds, the day's net settles between the banks, and Asha's provisional credit becomes final. Cheque Clearing Co is a fictional image-exchange operator. (SYNTHETIC / TRAINING ONLY)

Contributor Shubham Mathure19 July 2026

PAYMENTS SIGNAL · REFERENCE CARD

Actors

Asha Rao (payee)customer
Northstar Bank (collecting bank)bank
Cheque Clearing Co (image exchange)infrastructure
Bank Alfa (drawee / paying bank)bank
Demo Trading Ltd (drawer)customer

Messages

cheque deposit
cheque image presentment

The sequence

#	Step	Route	Kind
1	Cheque deposit — Asha deposits the cheque	Asha Rao → Northstar	message
2	Image capture — Northstar captures the image and truncates the paper	Northstar	internal
3	Provisional CR — Northstar credits Asha provisionally	Northstar	posting
4	Image presentment — The image is presented through the clearing system	Northstar → Clearing Co	message
5	Funds & signature — Bank Alfa checks the drawer's funds and signature	Bank Alfa	internal
6	Net settlement — The day's net settles between the banks	Bank Alfa → Northstar	settlement
7	Credit final — Northstar makes Asha's credit final	Northstar	posting
8	Funds available — Asha's funds are confirmed available	Northstar → Asha Rao	internal

Exception rails

Rail	Trigger	Where the money ends up	Next action
Returned: cheque unpaid	Bank Alfa will not pay — Demo Trading has insufficient funds, or a stop instruction is on the cheque.	The provisional credit is reversed out of Asha's account; Demo Trading was never debited. Asha has no money from this cheque. · The unpaid cheque was taken out of the net before finality, so no interbank settlement stood for it.	Bank Alfa — Asha chases Demo Trading for payment by another means; the cheque can be re-presented once, if the failure was a timing issue rather than a stop.