Executive Summary The Indian cheque payments system is on verge of a step-function improvement in the processes by which cheque transactions

are captured, cleared, and archived. Legacy systems are paper-based, redundant data-entry and physical handling, with high overhead costs in the areas of transportation and staffing. This system is subject to fraud, incurs errors which create higher processing costs, and creat es limitations in the ability to bring new products and services to market. Cheque Truncation System(CTS), or Image-based Clearing System (ICS), in India, i s a project undertaken by the Reserve Bank of India Check 21, is the catalyst fo r this significant opportunity. Through this bank will enable to create, transmi t, and utilize a digital image of the physical check. As a result, the industry has an opportunity for process improvement and unparalleled savings. Every new opportunity presents a series of challenges. Intent of this project is to present an objective and informative foundation of knowledge that are applied in implementation of the check capture solution. Data available from recent resear ch reports suggests that banks may realize significant savings. Also we will see various operational models that are currently present in other countries and ou r Indian banks can consider primary advantages and disadvantages so the reader m ay select the operational model most suitable to their own environment. Also thi s will try to explore n three critical areas; 1) hardware 2) software, and 3) im plementation considerations. "It will let you do things that are otherwise the preserve of IT, which should b e the ambition of any good analyst. If you need IT to sort data out for you, the n you've failed."