From October 4, 2025, 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 hours instead of the usual 1-2 business days.
The Reserve Bank of India (RBI) has scheduled a trial run on October 3 to ensure banks are ready for the official rollout.
Here’s what you need to know about the changes and how they affect you.
What is changing in cheque clearing?
Under the new system, cheques will no longer be processed in fixed batches. Banks will scan and send cheques continuously during the presentation session, which runs from 10 am to 4 pm. Each cheque will now be settled on a near real-time basis, cutting the clearing cycle from the current T+1 days to just a few hours.
Also Read: Banks to clear cheques within few hours from Oct 4, says RBI
RBI has also issued guidelines requiring banks to confirm cheques either positively (honoured) or negatively (dishonoured) during the session. If the drawee bank does not respond, the cheque will be deemed approved and included in settlement.
How will the new cheque clearing system work?
How is this better than the current system?
Currently, cheques take 1–2 business days to clear. With continuous clearing:
What does this mean for customers?
Will this apply to all banks?
Yes. The new rules cover all banks under RBI’s three clearing grids, Delhi, Mumbai, and Chennai, effectively covering the entire country.
Why is RBI conducting a special trial on October 3?
The trial run allows banks to test their systems and processes to ensure a smooth launch on October 4. This reduces the chances of errors or delays during the first day of continuous clearing.
Has cheque clearing always been this fast?
Cheque clearing in India has gradually modernized over decades:
RBI has directed banks to make customers aware of these changes to ensure everyone benefits from faster cheque settlements.
This change means that funds from cheques could reach your bank account within hours instead of the usual 1-2 business days.
The Reserve Bank of India (RBI) has scheduled a trial run on October 3 to ensure banks are ready for the official rollout.
Here’s what you need to know about the changes and how they affect you.
What is changing in cheque clearing?
Under the new system, cheques will no longer be processed in fixed batches. Banks will scan and send cheques continuously during the presentation session, which runs from 10 am to 4 pm. Each cheque will now be settled on a near real-time basis, cutting the clearing cycle from the current T+1 days to just a few hours.
Also Read: Banks to clear cheques within few hours from Oct 4, says RBI
RBI has also issued guidelines requiring banks to confirm cheques either positively (honoured) or negatively (dishonoured) during the session. If the drawee bank does not respond, the cheque will be deemed approved and included in settlement.
How will the new cheque clearing system work?
- Cheques deposited between 10 am and 4 pm will be scanned and sent to the clearing house immediately.
- From 11 am onwards, banks will settle payments hourly.
- In Phase 1 (Oct 4, 2025 – Jan 2, 2026), banks must confirm cheques by 7 pm; otherwise, the cheque will be auto-approved.
- In Phase 2 (from Jan 3, 2026), banks will have just 3 hours to confirm each cheque. For example, a cheque received between 10 am and 11 am must be confirmed by 2 pm.
- Once settlement is complete, the presenting bank will release the funds to customers within 1 hour, subject to usual safeguards.
How is this better than the current system?
Currently, cheques take 1–2 business days to clear. With continuous clearing:
- Funds can reach accounts within hours
- Clearing speed will be uniform nationwide
- Tracking the status of cheques becomes simpler and more transparent
- This change also reduces settlement risks for banks and improves overall efficiency.
What does this mean for customers?
- Faster access to money
- Quicker payments for businesses
- Consistent clearing speed across India
- Easier tracking of cheque status
- Customers are advised to stay updated with their banks for smooth processing during the transition.
Will this apply to all banks?
Yes. The new rules cover all banks under RBI’s three clearing grids, Delhi, Mumbai, and Chennai, effectively covering the entire country.
Why is RBI conducting a special trial on October 3?
The trial run allows banks to test their systems and processes to ensure a smooth launch on October 4. This reduces the chances of errors or delays during the first day of continuous clearing.
Has cheque clearing always been this fast?
Cheque clearing in India has gradually modernized over decades:
- Pre-1980s: Manual processing, could take a week
- 1980s: MICR sorting reduced local clearing to 1–3 days
- 2008: Cheque Truncation System (CTS) brought it to 1 day
- 2021: Nationwide grid introduced uniform T+1 clearing
- 2025: Continuous clearing reduces processing to a few hours
RBI has directed banks to make customers aware of these changes to ensure everyone benefits from faster cheque settlements.
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