Jamshedpur, Feb. 15: Financial transactions in the steel city hit a stumbling block after certain banks refused to accept non-Magnetic Ink Character Recognition (MICR) cheques.

Though branch managers of banks in the city had an emergency meeting today to resolve the issue, the deliberations remained inconclusive.

Probably the worst affected were the businessmen, who are often involved in transactions involving cheques.

People who tried to pay their telephone bills using non-MICR cheques were also put to trouble, as the instruments were not accepted at the central telegraph and other offices.

Until date, non-MICR cheques were in use. But trouble started on February 1, when banks suddenly stopped accepting non-MICR cheques. Bank officials said the cheques were not being accepted because of instructions from the Reserve Bank of India.

Following this move, other organisation such as BSNL and insurance companies also stopped accepting payments by non-MICR cheques.

Subhendu Dutta, who had gone to BSNL’s Bistupur office to pay his bills yesterday, said: “I came to deposit my telephone bill but the clerk refused to accept the cheque saying it was a non-MICR one. I don’t know what this fuss is all about.

“Neither have I heard about MICR before nor has my bank communicated to me that my existing cheque book would become invalid from February 1.”

The general secretary of the Singhbhum Chamber of Commerce and Industries, Suresh Sonthalia, said refusal of non-MICR cheques has resulted in huge losses to the business community.

“It is a unilateral action on the part of the banks, customers have no role in accepting or issuing MICR or non-MICR cheques,” Sonthalia added.

MICR cheques are in use throughout the country as such instruments can be cleared swiftly. A non-MICR cheque takes at least three days for clearance, whereas a MICR cheque can be cleared in one day.

While the MICR era was sweeping across the country, Jamshedpur seems to have been caught in a time wrap. Apparently, the banks have taken no steps to either convert to MICR usage or to spread awareness among consumers.

Union Bank of India’s MICR in-charge P.K. Tripathi said after an MICR centre was opened in the state in March, all banks have been asked to gradually shift to such instruments. “But it seems they did not pay heed to our instructions,” he said.

On February 10, Tripathi sent a letter to all the branch managers in Jamshedpur asking them not to refuse non-MICR cheques. But that has apparently not helped.