The Canadian Payments Association (CPA) has established new standards for cheques in order to make cheque processing a much simpler - and faster - process than in the past. These standards make cheque formats consistent across all Canadian financial institutions so digital cheque images can be accurately captured and easily shared.

Five million cheques are exchanged between financial institutions every day. Exchanging images rather than physical cheques will have a dramatic effect on processing time and cost.

This new cheque clearing process is targeted to begin this year, but be fully phased in by the latter half of 2008.

Here's how you personally benefit     

• Shorter holding periods for cheques on deposit
• More convenient and efficient record keeping
• Faster access to cheque information to verify cheque details
• Potential new security features to combat fraud

Here's how businesses will benefit (In addition to the above)

• Receive faster notification of unpaid cheques and will be able to start collection action much sooner
• Enjoy reduced storage costs since cancelled cheques will be images only and can be stored digitally

What you'll notice on the new cheques 

• The way you write the date at the top of your cheques. The format for dates will be numeric only either in the format of DD MM YYYY or MM DD YYYY to accommodate both French and English languages
• Revised specifications for the appearance of the cheques, for example, a clear area at the bottom of the cheque with no color or background, to ensure high quality images

There are also a number of other changes both to the front and the back that involve serial numbers, back layout, cheque length, etc.

Businesses that produce their own cheques can find out more at www.cdnpay.ca.

Do your current personal cheques look like this with the new 8-box date field? If they do, you're compliant with the new standards.

What you need to do for personal accounts

Cheques that have been recently reordered through PARAMA will be fully compliant. It's easy to tell if you have the new cheques; simply check the date area to see if you have the 8-box date field with DD MM YYYY or MM DD YYYY.

If you have the old-format personal cheques, you can continue to use them provided that a good image can be captured from them. The new system won't be completely in place until the latter part of 2008, so you have some time to use up as many of your old cheques as possible. When you throw your old cheques away or recycle, please be sure to shred them to help prevent identity theft. (You can also bring your old cheques into any PARAMA branch for shredding.)

What you need to do for business accounts

Businesses that have not yet updated their cheques should do so as soon as possible. Old format cheques can be used on an interim basis until September 2008 provided that they meet the requirements for the MICR line (the line of characters at the bottom of the cheque) and other specifications that were in effect prior to the publication of the new "image friendly" standard. This grace period allows you to use up your current cheques and update any cheque production software you may have. You will also need to obtain new compliant cheque stock.

Businesses are strongly recommended to prepare for the transition to image-based clearing by modifiying their cheques to comply with the CPA standards. We are pleased to advise that PARAMA can now provide you with fully-compliant standard business cheques for a competitive fee.

Your PARAMA Credit Union business advisor will be able to guide you through this process and answer any questions you may have.

To order new cheques

Please drop by or call your local branch to order.

If you use cheques that are not issued by PARAMA Credit Union, contact your supplier.