Cheques to Clear Within Hours: RBI Introduces New System from October 4, 2025 – Here’s How It Works

If you've ever deposited a cheque at a bank, you know it can sometimes take up to two days to clear. However, this delay may soon be a thing of the past. The Reserve Bank of India (RBI) is set to launch a new cheque clearing system from October 4, 2025, under which your cheques could be cleared within just a few hours.

How Will the New System Work?

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The RBI has announced that the current batch-based cheque transaction system will be replaced with a new method called "Continuous Clearing and Settlement on Realization."

Under this system:

Once a cheque is deposited, its scanned copy will be instantly sent to the clearing house.

From there, it will be forwarded to the paying bank, which must either approve or reject it within a set timeframe.

Major Benefits for Customers

With this move, the cheque clearing time will be reduced from 2 days to just a few hours, significantly speeding up transactions. This initiative by the central bank is aimed at enhancing efficiency and improving the customer experience in cheque-based transactions.

Implementation in Two Phases

Phase 1: October 4, 2025 to January 3, 2026

• Banks must confirm cheque processing by 7 PM on the same day the cheque is received.
• If a bank fails to confirm within this timeframe, the cheque will be automatically deemed accepted.

Phase 2: From January 3, 2026

• Banks will be required to clear cheques within just 3 hours of receipt.
• For example, if a cheque is deposited between 10 AM and 11 AM, the bank must approve or reject it by 2 PM the same day.

Presentation and Confirmation Sessions

• Cheque Presentation Session: 10 AM to 4 PM — during which cheques will be scanned and continuously sent for processing.
• Confirmation Session: 10 AM to 7 PM
• In Phase 1, the “Item Expiry Time” will be 7 PM.
• In Phase 2, this expiry time will be reduced to just 3 hours from the time of cheque receipt.