As per the directions of Reserve Bank of India (RBI), banks will clear cheques on the same day from October 4. The cheques deposited will be cleared within a few hours on the same day under RBI’s updated settlement framework that aims to speed up cheque settlement and enhance payment security. The development has come nearly two months after the RBI had mandated all banks to shift to the new cheque clearance system to provide better services to customers. Private banks, including HDFC Bank and ICICI Bank, will start same-day cheque clearance following the RBI updated settlement framework for quicker and more secure payments.

 

Both the banks have urged customers to keep adequate balances to prevent cheque bounce and to ensure all cheque details are accurately filled to avoid delays or rejections. 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. Banks will verify these details upon cheque presentation. Cheques will be cleared if the information matches; otherwise, the request will be rejected, and the drawer must resubmit the details. Customers are required to email cheque details to specific regional addresses. Banks will send an acknowledgment message upon receipt before processing.

 

The Cheque Truncation System (CTS), which sends an electronic image of the cheque and its details to the drawee bank, is currently used by banks. This removes the need for cheques to be physically transferred, but when deposited in drop boxes or automated teller machines, settlement usually takes two working days. Further, the RBI has made Positive Pay mandatory for cheques above Rs 5 lakh, while it is strongly recommended for those above Rs 50,000. Cheques validated under Positive Pay are also protected under the RBI’s dispute resolution system. The RBI had announced that Phase 1 of continuous clearing and settlement will begin on October 4, 2025, and Phase 2 will begin on January 3, 2026.