Nov. 16 (Bloomberg) -- Turkiye Is Bankasi AS, Turkey’s largest bank by assets, says it will provide guarantees for checks after the government scrapped jail terms for bad checks, leading to a surge in their number.
Bounced checks increased by 58 percent on an annual basis by the end of October, while checks submitted to be cashed rose by three percent, according to central bank data. The Turkish government passed a law in January scrapping jail terms for those convicted of writing bad checks.
“With this system, the person writing the check will get an Isbank guarantee for it within loan limits set by the bank,” Isbank Deputy Chief Executive Officer Suat Ince said at a news conference in Istanbul today. “This will make checks a reliable payment method again.”
Isbank will not charge the writer or the receiver of the check any fee for the service, he said. Check-writers can get their checks guaranteed by Isbank through text messages, the Internet or by using Isbank branches, he said.
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