RBI to Clear Cheques in Hours Starting October 2025

Beginning on October 4, 2025, the Reserve Bank of India (RBI) will implement a groundbreaking change in the cheque clearing process. This reform aims to drastically reduce the time taken to clear cheques from the current duration of up to two working days to just a few hours. This shift is expected to significantly enhance customer convenience and reduce settlement risks in the banking sector.

Under the new system, cheques will be scanned and processed continuously throughout business hours. This means that rather than clearing cheques in batches, banks will handle them in real-time. Currently, the Cheque Truncation System (CTS) allows for cheques to be cleared in one or two working days depending on the time of deposit. The new system is set to change that entirely.

The transition to this new clearing system will occur in phases. In the first phase, which lasts from October 4, 2025, to January 2, 2026, banks will be required to confirm (approve or reject) cheques presented to them by 7:00 PM on the same day. If a bank fails to respond by this deadline, the cheque will automatically be treated as approved and included for settlement.

Following this initial phase, from January 3, 2026, the confirmation period will be further tightened. Banks will need to confirm cheques within three hours of receiving them. For instance, if a cheque arrives between 10:00 AM and 11:00 AM, the bank must give its confirmation by 2:00 PM. Once again, if there is no timely response, the cheque will be automatically approved and cleared.

This initiative by the RBI marks a significant step towards modernizing the banking infrastructure in India. The faster cheque clearing process will not only improve customer satisfaction but also enhance the overall efficiency of banking operations. As the financial landscape evolves, such improvements are crucial for staying competitive and meeting the needs of a growing economy.