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SUMMARY
This Directive aims to minimise risks associated with such instruments; and shift consumers’ behaviour towards more efficient and traceable electronic payment instruments.
This Directive applies to:
- Local Credit and Financial Institutions
- CBM when acting as a PSP
- Natural and Legal persons
Paper-based instruments are to be considered as “Only” cheques meaning that such instruments are non-transferable and can only be negotiated by a Payment Service Provider.
If during the preceding 12 calendar months, 6 instruments presented for clearing but could not be paid out, the drawee institution is obliged to discontinue providing cheque issuance facilities to drawers for these instruments.
- The validity period of cheques remain 6 months
- A minimum amount of €20 for paper-based instruments - instruments equal to or below such limit will not be honoured by the PSPs
- A maximum amount of €5,000 for which paper-based instruments can be encashed - instruments exceeding such amount shall be deposited in the beneficiary’s account.
- Cheques/Bank drafts payable to legal persons shall only be deposited and not encashed.
Administrative penalties
If PSPs and/or PSUs do not comply with a requirement contained in this Directive.
Penalties imposed on PSUs:
- Shall not exceed €200; and
- May be for each issued instrument contravening this Directive.
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