RBI to Introduce Faster Cheque Clearing from Oct 4
Customers can expect to receive funds within an hour after settlement, subject to regular safeguards.
Mumbai: The Reserve Bank of India (RBI) on Wednesday announced a revamp of the Cheque Truncation System to speed up cheque clearance and settlements.
Under the new system, from October 4 cheques will be scanned, presented, and passed in a few hours and on a continuous basis during business hours. The clearing cycle will be reduced from the present T+1 days to a few hours. Currently, the Cheque Truncation System (CTS) processes cheques with a clearing cycle of up to two working days.
“It has been decided to transition CTS to continuous clearing and settlement on realisation in two phases. Phase 1 shall be implemented on October 4, 2025 and Phase 2 on January 3, 2026,” said the RBI in a circular.
Under phase 1, starting Oct. 4, will require drawee banks to confirm cheques by the end of the day which is 7 pm. If they fail to do so, they will be deemed approved for settlement.
Under phase 2, beginning Jan. 3, will shorten the confirmation window to just three hours from the time a cheque is received.
Under the new system, banks will scan and submit cheques to the clearing house continuously between 10 a.m. and 4 p.m. The clearing house will release cheque images to drawee banks in real time, and settlements will occur every hour from 11 a.m. until the close of processing, the RBI said.
Customers can expect to receive funds within an hour after settlement, subject to regular safeguards.
“All banks are advised to make their customers adequately aware of the changes in the cheque clearing process. Banks are also advised to be in readiness to participate in continuous clearing in CTS on the above dates,” said the RBI.