The checks issued by government agencies, particularly those drawing their funds from their Modified Disbursement System (MDS) account, maintained under the authorized government servicing banks such as the Land Bank of the Philippines (LBP), Development Bank of the Philippines (DBP) and Philippine Veterans Bank (PVB), are valid for three (3) months from date of issue. An MDS Check bears on its face the note “VALID FOR THREE MONTHS FROM DATE OF ISSUE“.
To differentiate, a commercial/personal check is valid for six (6) months while an MDS check is valid for three (3) months.
What will happen when the MDS Check was not encashed within the three (3) month validity/expiry period?
If an MDS Check was not encashed within the three (3) month validity period, this will become a stale check. A stale check can no longer be withdrawn and needs to be surrendered to the government agency concerned for replacement/re-issuance of a new check.
Note: It may take time before a stale check may be replaced.
The funds for a stale check reverts to the National Treasury; hence, the government agency which issued the check may need to request again the funds from the Department of Budget and Management before it can re-issue check. This is why it is important to encash MDS Checks before they expire.
[Read Treasury Circular No. 03-2017 for more details]
