Bahrain sees dishonoured cheques reach eight-year low
The Bahrain Monetary Agency has seen the number of cheques not honoured by its cheque clearance procedures drop 10% in the last year.
The Bahrain Monetary Agency last night (Jan 26) announced that it had seen a 10% drop over 2001 in dishonoured cheques processed within its cheque-clearance system.
This comes after a concerted effort by the BMA to crackdown on faulty cheques with the implementation of the Regulation Relating to Penalty System for Dishonoured Cheques, enforced since 1997.That year saw the number of returned cheques drop to 3.58% of total cheques processed, compared with 4.56% in 1995.
In contrast to 1995, the amount of cheques processed has increased by 2.5% from 2001 and this has resulted in the proportion of returned cheques to total cheques cleared dropping to 2.55% in 2002, its lowest point in 8 years.
“We are particularly focusing our efforts on reducing the incidence of cheques returned due to insufficiency of funds in the account or account closure, as these can imply mal-intent on the part of the cheque-issuer,” said Shaikh Salman bin Khalifa Al Khalifa, director of banking services at the BMA.
The actual number of cheques failing to clear in 2002 totalled 52,986, compared with 58,996 in 2001, while their value decreased to BD40.13 million (US $108 million) in 2002, from BD44.64 million (US $120.5 million) in 2001.
“We are committed to maintaining confidence in the usage and acceptability of cheques,” said Shaikh Salman.
“With the use of cheques, as a method of payment, increasing in the domestic market, there is a need to maintain the phenomenon of bad cheques at the very minimum,” he added.