Bank of Uganda (BoU) has made a decision to lower the cheque value amounts that can be written on a single cheque leaf. This will affect five currencies including the Ugandan Shilling.
The central bank noted that their decision followed a ‘no objection’ received from the Ugandan Bankers Association.
On Wednesday, the central bank issued a letter to all commercial banks, credit institutions, and micro-finance deposit-taking institutions.
In the letter, the central bank announced the reduction of the cheque value limit amount. It said the amount dropped from Shs20m to Shs10m.
Prior to that, BoU had directed commercial banks and other credit institutions that cheque amounts have been limited to Shs10m.
The limit affected only a single cheque per transaction for the exchange of instruments by commercial banks in the clearing house. The clearing house also settles cheque transactions on a daily basis.
However, on top of the Ugandan Shilling, the cheque value limits will also affect the US Dollar, the Pound Sterling, the Euro, and the Kenyan Shilling.
The reductions in figures
For the USD, they have reduced it from $5,500 to $2,750. As that of the Pound goes down from £4,400 to £2,200. They also cut down the Euro from €4,500 to €2,200. They reduced the Kenyan Shilling from 600,000 TO 300,000.
‘’In line with the provisions of Section 4.3 (b) of the Uganda clearing house rules and procedures, Bank of Uganda wishes to inform all clearing house participants of a downward revision to the cheque value limits for the currencies currently handled by the clearing house,’’ BoU noted.
Furthermore, the central bank revealed that they will stop honoring all cheques with the old limit threshold on January 15, 2022. This is in line with the six-month cheques stale period.
In addition to that, they said the new cheque limit thresholds will take effect on January 17, 2022.
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