Banks to Clear Cheques on Same Day From Tomorrow

Mumbai: In a landmark move, from Saturday, India’s cheque clearing system will become much faster, moving from a batch-based process to continuous clearing and settlement on realisation. This change means that funds from cheques could reach your bank account within a few hours instead of the usual one to two business days. The Reserve Bank of India (RBI) had scheduled a trial run on Friday of the new cheque clearance system before the official rollout on October 4. Under the new regime, all cheques deposited at bank branches during the single presentation session from 10 am to 4 pm will be scanned and sent instantly to the central clearing house, instead of waiting for an end-of-day run. The clearing house, in turn, will “release the cheque images to drawee banks on a continuous basis”, so your cheque starts moving through the system right away. Once a drawee bank receives a cheque image, it has until 7 pm to confirm whether it will honour or dishonour the cheque.

The RBI’s notification makes it clear that “drawee banks shall be required to confirm (positively/negatively) cheques presented on them, latest by the end of the confirmation session (i.e. 7 pm), else those will be deemed to have been approved and included for settlement”. This means, if the drawee bank does not respond, the cheque will be deemed approved and included in settlement. From 11 am onwards, banks will settle payments hourly.

The project is in two phases---the Phase 1 runs from October 4, 2025 to January 2, 2026 with a flat 7 pm expiry for all cheques. In Phase 2 (from Jan 3, 2026), banks will have just 3 hours to confirm each cheque, thereby making the system even more granular and responsive.

Once settlement is complete, the presenting bank will release the funds to customers within one hour, subject to usual safeguards. Private banks, including HDFC Bank and ICICI Bank, have informed that they will start same-day cheque clearance from October 4, following the Reserve Bank of India's (RBI) updated settlement framework.

Customers are also urged by the banks to use the Positive Pay System to enhance security, requiring prior submission of key cheque details for verification. Account holders must provide the account number, cheque number, date, amount, and beneficiary name to the bank at least 24 working hours prior to depositing cheques exceeding Rs 50,000.