New Cheque Standards FAQ's

Why has the CPA changed the Canadian cheque specifications?

The new cheque specifications are a key part of an industry-wide plan to modernize Canada's cheque clearing system through image technology. The new specifications are designed to ensure that high-quality images can be captured from the cheques for use by financial institutions and their customers, and to make cheque processing more efficient. For more information on this initiative, consult "Cheque Imaging: A Change Whose Time Has Come".

When do the new specifications come into effect?

The new specifications were published in January 2005 and are in effect now. All businesses ordering new cheques at this point should ensure that they meet the new specifications.

To help their business customers make a smooth transition, financial institutions are providing a grace period for "old format" business cheques until September 2, 2008. This extended transition or "grace period" will allow businesses that are still working on the changes to use up their existing supply of cheques and to make any required modifications to software. Personal cheques in the new format have been available through financial institutions since April 2005. Consumers with a supply of "old format" personal cheques can continue to use them until they need to re-order, provided that a good image can be captured from them. Based on experience to date, the vast majority of personal cheques are already "image friendly".

Customer would like to obtain the new version of the CPA's Standard 006?

Please direct the customer to the new version of Standard 006 is available on the CPA's web site (www.cdnpay.ca), and the new "image-friendly" cheque specifications are described in Part A. A summary of changes to the cheque specifications is also available.

If a business cheque in the new format fails testing, can a customer use it until the end of the grace period for "old format" cheques (i.e. September 2, 2008)?

Yes, provided that the cheques meet the requirements of the MICR line and other specifications that were in effect prior to the publication of the new "image friendly" Standard, businesses may continue to use them on an interim basis until the end of the grace period (i.e. September 2, 2008).

What are the main changes to cheque specifications?

Changes to cheque specifications in Standard 006, Part A include:

• Adoption of a numeric date field in one of three specified formats (YYYYMMDD, MMDDYYYY or DDMMYYYY). It is essential that field indicators be printed below the date field to indicate which format is being used. Bilingual date field indicators are accommodated for cheques using the international date format (YYYYMMDD).


• A mandatory serial number in the MICR line encoded at the bottom of the cheque (the serial number was previously an optional field in the MICR line).


• An increase in the minimum length of cheques to 6 ¼", or 15.88 cm, from 6", to ensure there is sufficient space for the mandatory serial number in the MICR line.


• Standardized positions for key fields on the cheque, including the date field and the amount in figures.


• Disallowance of elements that may hinder the capture of images or data from the cheque. For example, inverse printing, italics or slanted fonts, a bottom border printed below the MICR line, and the use of black carbon on the reverse of cheques will not be permitted.


• A provision to ensure that security features do not interfere with key data, or "areas of interest", as defined in Standard 006, Part A, either prior to imaging or post imaging. In particular, if a VOID pantograph or other hidden pantograph is used, the pantograph must not be visible on images captured from original cheques.


• New printing requirements on the reverse of the cheque so that image capture can be verified.


• Some revisions to technical specifications (e.g. Print Contrast Signal) to ensure high-quality images can be captured. For example, some complex or colourful backgrounds that have been used on cheques to date may interfere with image quality and may need to be changed.

Why are there three options for the date format?

The three options (YYYYMMDD, MMDDYYYY and DDMMYYYY) have been incorporated to reflect different practices in English- and French-speaking Canada. The requirement for date field indicators to be printed below the date will ensure parties that receive cheques can identify which format is being used. (See Section 5.4.1).

How do the changes affect individuals and companies that use cheques?

All cheques will require some changes.

• Companies that have custom cheques printed by a supplier will need to ensure that formats are modified to comply with the new standard. Key changes include adoption of the new numeric date field and printing of the date field indicators below, the printing requirements on the reverse of the cheque, and the mandatory serial number in the MICR line.


• Companies that use an internal system to generate cheques will likely need to make some system modifications - for example, to reflect the new date format, the standard positions of certain fields, and possibly changes to printing fonts. They will also need to update their cheque stock to reflect the new printing requirements on the reverse of cheques.


• Companies that use a financial software package to produce cheques will need to modify it or obtain a new version once the supplier has updated the package to reflect the new cheque specifications, as well as updating their cheque stock to reflect the new printing requirements on the reverse of cheques.

How can cheque printers, software providers and organizations that produce their own cheques confirm that their new versions meet all of the new specifications?

Cheque printers, software providers and companies that print their own cheques are strongly encouraged to provide pre-production samples to their financial institution's quality assurance division to ensure that they meet the requirements of the new standard. These organizations should contact their financial institutions for more information about the testing process and timelines.

What will happen if some cheques do not fully comply with the new specifications when the new image-based clearing process is implemented?

In providing an extended transition period since the publication of the new cheque specifications in January 2005, the CPA and its members expect that the vast majority of cheques will comply with Standard 006 by September 2, 2008 when the grace period for "old format" cheques ends.

Adopting the new specifications before then is particularly important for business cheques, as these represent the largest volumes and there are currently significant variations in the formats used. A business that does not adopt the new cheque specifications by that date may risk having cheques that cannot be properly imaged in accordance with CPA requirements and consequently cannot be cleared using the new process. At that time, financial institutions will work with clients to resolve any issues. By making the transition to the new cheque format before the new clearing process is implemented, businesses will avoid potential problems and be ready to reap the benefits of cheque imaging within their own organizations.

Personal cheques in the new format have been available through financial institutions since April 2005, and consumers who have ordered cheques since that date have received the new format. Consumers with a supply of "old format" personal cheques can continue them until they need to re-order, provided that a good image can be captured from them. Based on experience to date, the vast majority of personal cheques are already "image friendly".

Are the specifications for other MICR-encoded documents changing?

Yes, the CPA has also published specifications for some other imageable MICR-encoded documents in Section 6 of Standard 006 in June 2006.

Specifications for some other imageable MICR-encoded documents have been published for:

• bank drafts and money orders;
• inter-member debits;
• settlement vouchers;
• point-of-sale contingency vouchers;
• Canada Savings Bonds;
• provincial savings bonds;
• and Canada Post money orders.

The complete specifications of other imageable MICR-encoded items are available in Section 6 of Standard 006, and a summary of the required elements of each of the items is also available. The deadline for implementation of the specifications for these payment items is slated for December 31, 2007.

When will businesses and consumers begin receiving cheque images instead of cancelled cheques?

Several CPA members are already offering image-based services to some client groups. It is anticipated that the introduction of image services for business and consumer clients will accelerate in the period leading up to the implementation of the new image-based clearing process in the latter part of 2008.

Do the new specifications have any impact on cheque security features?

The CPA's new cheque specifications will accommodate a range of features currently in use as well as new approaches that are emerging for the image environment, but the transition to image-based processing may have an impact on some security features. For example, some of the traditional paper-based security features may not be visible on cheque images; however, they may still serve to protect against counterfeiting or alteration of cheques. Any security features used on cheques must not interfere, either before or after imaging, with the MICR line or other areas of interest as defined in Standard 006, Part A. In particular, if pantographs are used, they must not be visible on images captured from the original cheques. As well, certain techniques such as inverse printing that may interfere with image or data capture will no longer be permitted.

Is the CPA's new cheque standard compatible with comparable international standards?

Standard 006, Part A includes some requirements that are specific to the Canadian environment, such as the positioning of elements within the MICR line and the minimum size of cheques (6.25 inches). For other aspects such as background screening and reflectance, the CPA has adopted ANSI standards where possible.