To curtail the transit time taken in collection of cheques drawn on US banks, which are sent to India and then send back to US for collection, Indian Banks have introduced a new concept called Lockbox service for NRIs based in USA.
HIGHLIGHTS:
• A new facility, exclusively to cater to the long felt need of NRIs based in USA.
• No monetary limit for transferring funds to India
• NRIs can send the money in USD only.
• Remittances by way of Cheque to anywhere in India through a wide network of branches
• No need to send cheques to India and again to USA for collection.
• Get the cheques realized in USA itself, at a marginal cost, in fact less than wire transfer cost, that too at a faster pace than the present system of Cheque collection.
HOW IT WORKS:
• The Cheque deposited by beneficiary will be presented in the local clearing in USA by correspondent bank of your bank. For e.g. Bank of America on behalf of SBI, India.
• A provisional credit will be given to your bank account after three business days after receipt of the Cheques at correspondent bank's processing centre.
• Your Bank will credit your account after cooling period of 10 business days from the date of credit to their account with correspondent bank.
Eligibility for "Lockbox facility"
The beneficiary of the remittance should have complied with Know Your Customer (KYC) guidelines of the Bank and have an account with the Bank.
Benefit of Lockbox facility for customer.
Saves transit time i.e., time taken to send the Cheque to India and again back to USA for collection. Cost of sending the instrument to India and from India to USA is also saved.
How long it will take for the beneficiary to avail the funds?
Normally 10 business days. Correspondent banks normally makes available the funds three business days after receipt of the cheques at their Processing centre. Your bank in turn will make available the credit after 10 business days (from the date of credit to their nostro account.)
What should remitter verify before he sends the Cheque?
Check whether the following details on the Cheque are properly filled up:
- Name of the beneficiary
- Date of the Cheque in locally acceptable form (mm/dd/yy)
- amount in words and figures and signature
- Cheque should be drawn in USD on accounts maintained in USA.
- Amount of the cheque and other details should tally with that of the "Deposit Slip".
- make sure that sufficient balance is maintained in your account when the Cheque is presented to your banker