New check clearing process in Philippine banks



A few weeks ago, I issued a post-dated check (PDC) but forgot to fund it prior to deposit date. My bank, the Bank of the Philippine Islands (BPI), called me up to follow up. I then immediately made the fund transfer and the check was honored on the same day without me paying any fees.

Unfortunately, starting this year, this is not anymore possible. The Bangko Sentral ng Pilipinas (BSP) recently issued Circular No. 681 or the “Revised Check Clearing and Settlement Processes.” Taking effect on January 1, 2011, the circular basically requires check issuers to fund the check prior to issuance.

BSP Circular: Revised Check Clearing and Settlement Processes

The BSP circular requires banks to return Drawn Against Uncleared Deposit (DAUD) and Drawn Against Insufficient Funds (DAIF) checks to the Philippine Clearing House Corporation (PCHC) by 7:30am the next day.

What this means is that there’s no more window for late funding. Any unfunded check will be considered as returned or bounced checks. At the same time, a returned check will be charged a fee of Php2,000 plus Php200 for every Php40,000 fraction of the check amount per day (not sure if this is the rate of BPI or by all banks).

As for checks subject to Stop Payment Order (SPO), they can be honored as long as the check has not been deposited for clearing by the payee yet. Otherwise, they will be considered unfunded already and will be charged the corresponding fees.

The new BSP Circular simply forces us to ensure that the account is funded when issuing checks.

38 thoughts on “New check clearing process in Philippine banks”

  1. May question po ako, talaga po bang may 2,000 pesos penalty kapag late funding pero naclear ang check? It was happened on year-end holidays.

  2. may question din ako regarding unfunded check, what will happen sa taong inissuehan mo? iddeposit nya ulit yun on dat day ?

    1. Hi Alex, based on the revised policy, unfunded checks will be considered Returned Checks or Checks with Insufficient Funds. I’m not sure if banks would allow depositing of the same check even if it will already be funded, but the issuer of the check will already be charged Php2,000 plus Php200 for every Php40,000 fraction of the check amount per day.

  3. This article says nothing about how soon a check is cleared when it has been deposited in a bank.

    In this respect it is useless to readers seeking to know how soon, etc.

  4. Hi @MariusDejess:disqus, there is no change in the check clearing period. It’s still 3 banking days for checks issued by other banks and 5-7 banking days for regional checks. The new rule stated in the article does not affect the check clearing period, it only affects the check clearing process of banks and its impact to users issuing a check.

  5. there is stil overnight charges on checks returned?di ba yung mga daud or daif checks are returned on the same date it was presented?bakit my overnight charges pa?di ba pwedeng mawaived yun?

  6. may question po ako..regarding the SPO, d po b pineperforate ung MICR codeline nung check, at stamped on the face of the check, so hindi na pwedeng irenegotiate khit malift ung stop payment order?

    1. clarielyn gonzales

      Hi good pm po binigyan po ko ng metrobank check po cia sept 25 po cia naissue pero naibigay sa akin nitong october lng po ilan days po b cia valid?

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  8. Good day po! I just want to know what are the different types of clearing checks & its no. of clearing days.

    1. Manila/otherGovernment Checks
    2. Out-of-Town Regional Checks
    3. Out-of-Townchecks drawn against banks not participant to the BSP Regional Clearing
    Office

    4. what are the other types of checks for clearing

    Thanks.

  9. Anne Celine Marquez

    Tanong lang po. Paano kung ang issued date ay natapat ng Saturday tapos yung bank ay close every weekend. Pwede pa po ba sa Monday ang cash out? O sa mismong araw lang nakalagay sa check pwede talaga kunin ang pera? Salamat po sa tulong

  10. paano po na encash ang cheque sa pinas kung nandito sa ibang bansa anf bearer ng cheque? pwede ba ipadeposit sa account ng mother ko. anong mga requirements para madeposit yung cheque sa account ng mother ko

  11. A check drawn against insufficient funds went stale. How can the bank help me prove that it is a “bounced check” when it is already past six months period to encash? I want the bank to help me prove to the borrower that she issued a bounced check and that I want her to settle her payments before I file a case. Advise, please.

    1. why did it take you that long to have it encashed? technically, it can’t be considered a “bounced check” when it was not yet deposited or encashed by the payee. Can’t you request for settlement of the payment considering that the check payment was not encashed on time?

  12. Hi po.. Ask lng po… I issued a check last march 18 2017 tapos na funded po xa march 20/21 na ata, considered po ba yun na na debit sa account ko? Ksi wen I deposited the funds na ipasok nman din po sa account ko…

  13. jennifer de asis

    Hi may question ako..Ang date ng check ko is Friday Ucpb po sya.pwede ko pa po ba mafund un s monday since 3 days po ang clearing..BDO po ung pagdedeposituhan pero ndeposit n nila nung Friday.Pano po un?

  14. Jonathan Rosete

    we have 3 checks for clearing this date. unfortunately the fund fell short. the bank have chosen the the biggest amount of check for that day to be bounced check. as advise by manager ganon daw po yung policy. the biggest amount of checks yung ibabounce nila.. valid po ba eto?

  15. someone issued pdc and i deposited in the bank unfortunately no fund, I informed her about it and she said she will just pay me in cash instead, im just curious what will happen to the check deposited? thanks.

  16. good am po .. ask ko laNg po if Good pa ang cheque na Dated sya By March, 2108 and idedeposit pa lang sya dis July, 2018 po. tHankyou.

  17. May we request to waive penalty since last Friday I came to nearest BPI after my work but it’s already closed.
    Today I already deposited my payment but as I check on my online, I already have 2k penalty.

  18. Hi tanong kulang po nag issue ako ng pdc nung monday ng sa may ari ng bahay na binili ko and by tuesday nag encashment po xa and thw next day bpi called me that i need to settled kasi 35,000 lang daw yung funds ko and which is i issued a 42,000 doon sa may ari nang bahay ganun ba talaga yun kailangan talaga mag bayad nang 2,000 penalty

  19. Na approved po akl sa isang lending need po ng pdc check ngayon mag apply sana ako sa banko para cheking account pwd po ba yun , kasi naka pintong banko na ako napuntahan need nila mag open muna ako ng saving account after 6month dun pa pwd bigyan ng checking account may ibang bank ba na pwd kahit walang saving account sa kanila

  20. Nag issue sa akin yung payor ng 24 checks as payment ng property kaso 2 months dalawang checks na ang overdue July and August at ngayon September na ayaw iconsider nung bangko na bounced yung checks. Pwede ko bang ireklamo yung bangko?

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