Cheques to be cleared within hours from tomorrow: Explained

From Saturday, India’s cheque clearing system will move to a continuous process, cutting the time it takes for money to reach accounts from days to just a few hours. RBI is replacing the current batch-based model with near real-time settlements. Banks will run a special trial on Friday to test their systems before the official rollout

What is changing from Oct 4?

Cheques will no longer be cleared in fixed batches. They will be processed continuously through the day, so funds can reach accounts on the same day.

How will the new system work?

Cheques deposited between 10am and 4pm will be scanned and sent for clearing instantly. From 11am, settlements between banks will happen every hour. The paying bank must confirm by 7pm. If it does not respond, the cheque will be auto-approved.

At present, funds usually take 1–2 business days to clear. Under the new system, they can be credited within hours.

What does this mean for customers?

➤ Faster access to money ➤ Quicker payments for businesses ➤ Uniform clearing speed nationwide ➤ Easier tracking of cheque status

No. It has sped up over time:➤

Pre-1980s:

Manual, could take a week ➤

1980s:

MICR sorting cut local clearing to 1–3 days ➤

2008:

Cheque truncation system (CTS) reduced it to one day ➤

2021:

Nationwide grid brought uniform T+1 clearing ➤

2025:

Continuous clearing starts Oct 4, cutting it to hours

Yes. The rules cover all bank branches under RBI’s three grids — Delhi, Mumbai and Chennai — which together cover the entire country.

(Oct 4–Jan 2, 2026): Banks must confirm by 7pm

Phase 2

(from Jan 3, 2026): Banks will have just three hours to respond

Friday’s trial run is meant to test systems and ensure a smooth rollout.