THE NATIONAL Bank of Rwanda (NBR) will introduce a new system to ease cheque payments and fight forgery.
Amb. Claver Gatete, Governor BNR, said the initiative would link all commercial banks to the central bank through an electronic system, which will help to carry out transfers and compensations in a short time compared to today.
"This will be done through the cheque truncation project, which will also curb physical cheques during payments," Gatete said.
He was speaking during an event organised by the Christian Financial Fellowship to celebrate its achievements as well as plan for the year ahead.
The association brings together financial professionals from different institutions and aims at transforming the country's financial sector. Currently, the association has over 400 members.
The event, which attracted representatives from various organisations, financial institutions and insurance companies, was held in Kigali.
Gatete explained that the initiative would enable banks to electronically conduct compensation transactions using the link from the central bank.
For example, if a bank receives a cheque from any other bank, it will be able to check on the system to know whether the account holder has money for the bank to clear the cheque.
"We have already agreed on the unique features that these cheques must have and can only be read by the cheque readers, which we shall instruct every bank to have," he said.
He explained that because the banks would be linked, it would give the National Bank of Rwanda a central role in co-ordinating the use of the electronic system.
Banks are currently applying for the new cheques as one of the steps taken to implement the project. This is expected to reduce delays in transactions or payments as the central bank directly handles compensations.
Daniel Mugisha Muhimuzi, the Christian Financial Fellowship chairman, commended the initiative, saying it would make financial institutions more effective.
He acknowledged that this was one of the effective responses the central bank had taken to improve the performance of the banking system.