The duties of a collecting banker towards his customers are as follows:
1. Acting as agent: While collecting an instrument, whether for credit to customer’s account or for himself, the Bankers works as agent of his customer. As an agent he has generally to take such steps & precautions to protect the interest or his customer as a man of ordinary prudence would take to safe-guard his own interest.
2. Scrutinizing the instruments: Name of the holder, Branch name, date, amount in world and figure, any cutting without signature, material alteration of any to be checked carefully.
3. Checking the endorsement: Bankers has to check the instrument whether it has been endorsed properly.
4. Presenting the instrument in due time: It is the responsibility of the collecting bank to present the instrument in due time to the paying bank.
5. Collecting the proceeds in the payee’s account: It is the duty of collecting banks to collect and credit the proceed of the instruments to the proper/correct account.
6. Notice of dishonor and returning the instruments: If any instrument is dishonored by the paying bank it should be informed to the customer on the business day following the receipt of the unpaid instruments.