The RBI announced on Wednesday the introduction of continuous clearing and settlement of cheques, dropping the current approach of batch processing.

Under the new system, the clearing cycle will be reduced from the present T+1 days to a few hours. “It has been decided to transition CTS (Cheque Truncation System) to continuous clearing and settlement on realisation in two phases. Phase 1 shall be implemented on October 4, 2025, and Phase 2 on January 3, 2026,” said RBI. The presentation time has been set between 10 am and 4 pm, while the confirmation session (if cheques will be honoured or not) is between 10 am and 7 pm.

Cheques received by the branches shall be scanned and sent to the clearing house by the banks immediately and continuously during the presentation session. The clearing house will, in turn, release the cheque images to drawee banks on a continuous basis.

The RBI said during phase 1, drawee banks shall be required to confirm (positively /negatively) cheques presented on them, latest by the end of the confirmation session (7 pm), else those will be deemed to have been approved. In phase 2, the item expiry time of cheques shall be changed to T+3 clear hours.