UAE banks given more time to embrace cheque fraud rules

New rules to tackle cheque fraud which were due to come in on January have been postponed to give banks more time to adopt security measures needed.

Tough new banking rules aimed at combating cheque fraud are likely to be delayed until the middle of the year, Central Bank officials say.

The postponement will allow banks and customers more time to prepare for the legislation, which bans the use of cheques without enhanced security features.

The regulator had told banks to start refusing cheques without such features from January 1.

A flood of enquiries from concerned customers about the changes has now prompted the regulator to relax the rules.

"This decision has been made to help customers," said a Central Bank official involved in the legislation who asked to remain anonymous. "Customers were saying banks were not accepting their cheques."

Banks were informed in February last year they needed to prepare for accepting only cheques readable by machine under a drive to crack down on forgery.

Designed with electronic bars and other security devices, the cheques are much harder to counterfeit. In addition, the cheques can be cleared by machines much more quickly than the manual method used for old-style cheques.