Newgen Case Study on Application of Cheque Truncation System.

1. Case Study BANKING
S OLUTIONS F OR B USINESS P ROCESS & C O N T E N T M ANAGEMENT
Application of Cheque Truncation
System
For the Largest Private Bank in UAE
Overview
The client is one of the leading banks in the UAE, with total assets as on 31st
December 2005, of AED 45,742 million (US$ 12,453 million), making it the
The client is the largest private bank largest private bank in the UAE. The bank has strong brand equity in the
in the UAE. It has a wide range of dynamic and highly competitive UAE market place, and has pioneered many
product offerings in every business innovative products and services. It has a wide range of product offerings in
segment. every business segment.
The Challenge
Under the existing process, the bank used to send and receive the cheques
manually. A cheque took up to 3 working days for clearance. The bank was
using a system, Mosaic, for processing of cheques. Data on the cheques used
be entered through Mosaic interface and sent for storage and archival.
However, in light of regulatory mandate to implement an image-based,
electronic cheque clearance solution, the bank had to move to a robust and
scalable solution.
The requirements included alignment of the process as per the central bank
The requirements included specifications and document management for better maintenance of the
alignment of the process as per the cheques.
central bank specifications and
document management for better The solution also needed to seamlessly integrate with existing core banking
maintenance of the cheques. Also, system and other applications, so that the bank faced no extra IT
the solution required to seamlessly infrastructure costs burden.
integrate with existing core banking
system. In addition, formulation of electronic cheque clearance policies by the
Central Bank was undergoing regular changes.
The NEWGEN Solution
After evaluating various solutions from leading vendors, the bank zeroed-in
on Newgen's Cheque Truncation System (CTS). The Newgen solution
would enable Straight Through Processing, thereby speeding the cheque
clearing cycle with minimal manual intervention. The cheque images would
seamlessly flow from the branches to the head office to the central bank and
back.
Newgen's Cheque Truncation The in-built workflow would handle mapping cheques to the respective
System (CTS) enables Straight banks, routing cheques for approval, signature verification, etc. Newgen
Through Processing, and has been CTS has been integrated with the core banking system, Banksys. Using the
implemented for Outward clearing, public key infrastructure (PKI) technology, the solution provides secure data
Inward clearing, On-Us clearing exchange and non-repudiation of information.
and PDCs clearing.
The solution has been implemented for Outward clearing, Inward clearing,
On-Us clearing and PDCs clearing.
Outward Clearing: The branches scan the cheques and verify the image
quality of the cheques. Subsequently, cheques are sent to the central
processing unit of the bank for data entry and verification. The cheque
images along with the accompanying data are then put into envelopes to be
uploaded through FTP to the central bank server for processing. An envelope
packs together cheque image and corresponding data for thousands of
cheques using the standard X9.37 format.
www.newgensoft.com

2. Case Study BANKING
S OLUTIONS F OR B USINESS P ROCESS & C O N T E N T M ANAGEMENT
Inward Clearing: After downloading the Inward clearing cheque
envelopes, the cheques are divided into four categories: Normal cheques,
Vostro cheques, Pay Orders and Unuploaded items. These cheques are then
corrected and posted for financial entries. The failed-posting items are
moved for financial referrals and successful items are sent for technical
The requirements included
verification. Once successfully verified, the payments are cleared. The
alignment of the process as per the
rejected technical verification items are moved to signature referrals for
central bank specifications and
decision.
document management for better
maintenance of the cheques. Also,
On-Us Clearing: This involves in-house cheques of the bank. The cheques
the solution required to seamlessly
are processed as a hybrid of Outward and Inward clearing process.
integrate with existing core banking
system.
PDCs Clearing: This involves are 4 types of PDCs: Normal PDCs, Osool,
Mabrook and LBDs.
The Benefits
The solution, once live, would offer following benefits:
! To Business: The benefits to the business are multifold. The most obvious
advantage would be shortening of cheque clearing cycle resulting in
improved customer service and responsiveness. Also, lesser manual
Newgen Software is a market leader intervention would result in driving down the costs associated with
in Business Process Management physical transportation and physical storage of cheques. In addition,
and Enterprise Content Newgen solution does not require any extra IT infrastructure investment.
Management The solution is highly scalable and would easily handle any amount of
escalation in cheque volumes
! To users: The users at bank would no longer depend on physical cheques
or archaic procedures, used by the bank currently, to maintain data related
to the cheques. The cheque images are stored and retrieved much more
efficiently using the Document Management System. Also, features like
reporting tool and email intimations provided as part of CTS
implementation will help users in better managing the turn around
time of the clearing cycles
About NEWGEN
! Shortening of cheque clearing
cycle Newgen Software Technologies Limited is a market leader in Business
Process Management (BPM) and Enterprise Content Management (ECM),
! Slashing of cost associated with with a global footprint of about 700 installations in over 30 countries. More
physical transportation and than 100 of these implementations are large, mission-critical solutions
storage of cheques deployed at world's leading BFSI, BPO, and Fortune Global 500 companies.
! No extra IT infrastructure Winner of several awards such as “Frost and Sullivan’s Market Leadership
investment Award for Document Management System and Workflow Software &
Services” and “Distinguished Application Product Company” by
! Highly scalable solution NASSCOM, Newgen Software is an ISO 9001:2000, ISO 27001 certified
Efficient storage and instant and CMM Level 4 company.
Retrieval of cheque images
NEWGEN prestigious clients include HSBC Bank, Mashreq Bank (UAE), Deutsche Bank, Hua Nan
Bank, ABN Amro Bank, ICICI Bank, IDBI Bank, State Bank Of India, ING Vysya Bank, CitiFinancial,
RAK Bank, Bank of Tanzania, Max New York Life and Bajaj Allianz., Uniliver, Philips, GE Countrywide,
EXL, Satyam Nipuna, iGATE, Core 3, Ranbaxy, GSL, Kenyan Airways, SEC Phillipines.
Newgen Software Technologies Ltd.
www.newgensoft.com
A-6, Satsang Vihar Marg,
Qutab Institutional Area,
New Delhi 110 067
Tel: +91-11-26964733, 26963571, 26856871
Email: newgen@newgen.co.in
Newgen Software Inc.
CTS - MASH - 02
Tel: +1-703-749-2855
Tel: +1-510-794-6724
Email: info@newgen.net