What are the duties of a Collecting Banker?

The collecting banker is a banker who collects cheques drawn upon other bankers for and on behalf of his customer. He is called the collecting banker as he undertakes the work of collection of Cheques. Holder for value: A collecting banker becomes a holder for value if he has paid the value of the cheque to the customer before the cheque is already collected. As an agent: A collecting banker acts as an agent of the customer on crediting the account of the customer only after realizing the payment from the paying banker (drawee bank). Duties and Responsibilities of a Collecting Banker: Banker must take at most care while presenting the cheque for collection. Collecting banker must present the cheque within reasonable time. Serve Notice to/inform customer in case of dishonour of cheque. The banker has to credit the proceeds of the cheque to the account of the customer. Should undertake the collection of cheque only for customer and not for stranger. Must receive the payment as an agent of the customer. Cheque must be crossed to get the protection of Section 131 of Negotiable Instruments Act, 1881.