S.K. Goel in Calcutta on Saturday. A Telegrpah picture

Calcutta, July 26: Uco Bank will introduce a pre-funded cheque facility for its customers that will have multi-purpose use. These cheques can not only be used as demand drafts but also as traveller’s cheques, gift cheques and multi-city cheques with no service charges.

“We’ll launch this service for our savings as well as current account customers within a month,” said S.K. Goel, chairman of Uco Bank.

“The pre-funded cheques will be first introduced through select 250 CBS branches of the bank,” he added. Uco Bank has over 900 core banking solution (CBS) branches now and aims to have 1,400 branches by the end of March next year.

While customers having deposit accounts in these 250 branches will get pre-funded cheques, if they opt for it, the cheques can be encashed at any of the 900 branches.

The pre-funded cheques will be available in denominations of Rs 1,000, Rs 5,000 and Rs 10,000. A customer will have to keep a minimum balance in the account equivalent to the amount of cheque one wants. Pre-funded cheques will be issued to account holders who have a minimum balance of Rs 10,000 in their accounts.

Till the cheque is encashed, the money will remain in the account of the depositor. So, the deposit continues to earn an interest of 3.5 per cent. This is unlike a demand draft where there is no interest income before encashment.

Uco Bank is the first bank in the country to launch such a product .

Profit up marginally

The city-based bank today reported a net profit of Rs 134 crore on a consolidated basis for the April-June quarter in the current financial year, marginally up from Rs 133 crore in the same quarter a year ago. The bank’s total business during the quarter grew 26.18 per cent to Rs 1,33,960 crore.

The bank has been able to improve its non-performing assets (NPA) during the quarter. Gross NPA came down to 2.82 at the end of June this year from 3.68 per cent a year ago, while net NPA improved to 1.91 per cent from 2.54 per cent.