In a move to counter on cheque frauds, banks in the UAE plan to use new technology Like QR codes. It will boost the overall cheque security within the nation.
The body which controls the banks in the country, i.e. UBF, intends to roll out a high tech encryption technology. It will allow users to assign cheques randomly through a number that can be verified digitally through an automated validation process. Only genuine cheques will be given by the banks as the random cheques will be unique to the specific ones.
As per an official statement, fake cheques have exposed business, banks,and customers towards legal, financial and reputational risks. High tech printing technologies have opened doors for fraud to increase, and UBF banks are ready to counter the risk together.
HASH is a one-way-identifier which is used in the new automated approach. Its mechanism uses an algorithm to mix random numbers with MICR data. HASH cannot be misused as it is totally unique and random to the individual cheques. It is located in the cheque leaf and acts as a secret key for the cheque.
When individuals will get the cheque, they need to scan it through the QR code from the cheque leaf along with MICR details. After that, they need to verify it with ChequeChain system for authentication against the unique HASH.
Once the process is completed, HASH will verify the values and the value doesn’t match with HASH then the ChequeChain system will reject the authentication.
The UAE is planning to go cashless by 2020.