The Reserve Bank of India (RBI) has said that it will make big changes to the Cheque Truncation System (CTS) to speed up the clearing and settling of checks. The first phase of the new system will start on October 4, 2025, and the second phase will follow.
The new system will replace the current batch-based approach with one that clears and settles all the time. The Reserve Bank of India (RBI) has said that banks will now scan and send checks to the clearing house all day, from 10 a.m. to 4 p.m. The clearing house will then send photographs of the checks to the drawee banks in real time. Settlements will happen every hour from 11 a.m. till the end of processing.
Important Changes:
Phase 1 (starting on October 4): Drawee banks must confirm checks by 7 p.m. If they don’t, the checks will be seen as cleared for settlement.
Phase 2 (starting January 3): The confirmation window will be cut down to just three hours after a check is received.
Customers can anticipate to get their money within an hour after the settlement under this new arrangement, as long as normal banking safety measures are in place. The RBI has told all banks to get ready for the move and let their clients know about it. The goal of the change is to make cheque-based transactions more efficient, cut down on delays, and make the client experience better overall.