Automated Interbank Cheque Clearing

Working with one of the leading financial institutions, our goal was to transform and simplify their cheque clearance operations — a process that had long been resource-intensive and error-prone. Before our involvement, the bank’s cheque handling system faced a number of operational and technical challenges that were limiting its efficiency, scalability, and security.

Here’s what the manual cheque clearing process looked like and the core issues we aimed to address:

1. Time-consuming and fragmented verification process: The clearing team had to manually check cheque details in both multiple platforms, then re-enter the same information into internal systems — leading to delays and redundancy.

2. High dependency on manual labor and lack of automation: On peak days like Sundays and Mondays, the workload would surge dramatically, requiring overtime or even outsourced support to manage cheque volumes.

3. No built-in intelligence to prevent potential fraud: The system lacked logic to detect risks like account dormancy, repeated cheque issuance on the same balance, or mismatch in signature — causing exposure to financial loss.

As you can see, the need was clear: the bank required a smart, streamlined, and secure system that could modernize cheque clearing while reducing time, effort, and potential error.

The solution was built as a centralized web-based dashboard that consolidated cheque data from multiple sources, removing the need for employees to manually log into separate systems. The platform leverages advanced technologies such as Optical Character Recognition (OCR), Large Language Models (LLMs), and signature verification algorithms to streamline and accelerate the entire verification and clearance workflow.

Key components of the solution include:

1. User & Admin Portal: A secure role-based interface where employees can view, validate, and act on cheques received. Admins can set permission levels, such as limiting how much value a new employee can approve.

2. Automated Data Extraction: AI OCR technology reads handwritten and printed data from cheque images—including account numbers, amounts, and dates—even supporting conversions between English and Nepali text.

3. Real-Time Validation: The system connects directly to core banking system to check account balance, account status (active/dormant), stamp presence, and performs automated signature verification to reduce the chance of human error.

4. Cheating/Fraud Detection Mechanism: The system flags anomalies such as multiple cheques drawn against insufficient balance, or transactions attempted on dormant accounts—allowing early rejection before processing.

5. Performance Efficiency: Cheques that previously took 3 minutes to process manually are now cleared in under just 10 seconds, significantly improving throughput, especially during high-volume days (Sunday/Monday).

This integrated solution not only improves accuracy and reduces errors but also ensures faster, smarter, and more secure cheque clearance—bringing transformative efficiency to the bank's back-office operations.