AIB is to speed up its process for clearing cheques, offering customers almost immediate value on cheques lodged to or drawn on their accounts.

A spokesman for AIB said yesterday that the bank's customers would gradually he introduced to the new one day clearing system, which is expected to be available throughout the state by the end of next year. AIB is the only bank to have so far introduced a faster system to clear cheques for its customers.

Together, with the other major clearing banks, AIB currently operates a three day clearing system, leaving a lengthy period between the time the cheque is lodged and the adjustment to the customer's account.

Designed by the bank's own information technology department, the new banking system will also improve other areas of its services, allowing the bank to update customer account information more promptly.

"The new system will be up and running in one of our branches from Monday, with others joining it as part of a planned national roll out," a spokesman said.

The new technology will not reduce overall bank charges, and many customers may face higher interest payments as a result.

When writing cheque, for instance, customers will have to ensure that they immediately have sufficient funds in their account to meet it.

As the bank will also be moving to charge interest on overdrafts immediately, many customers may pay higher bank charges.

Depositors will see the benefits getting immediate value for cheques lodged and on interest payments.