RBI to Roll Out Continuous Cheque Clearing in Two Phases From Oct 2025

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  • Last Updated on 18 August, 2025

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Continuous Cheque Clearing

Circular No. RBI/2025-26/73 CO.DPSS.RLPD.No.S536/04-07-001/2025-2026; Dated: 13.08.2025

RBI’s Transition to Continuous Cheque Clearing

The Reserve Bank of India (RBI) had earlier announced a significant reform in the Cheque Truncation System (CTS), shifting from the current batch processing model to a continuous clearing system. This transition aims to enhance efficiency and ensure quicker settlement of cheques, aligning with the broader objective of modernising payment systems in India.

Phased Implementation Plan

To ensure a smooth transition, the RBI has decided to roll out the new system in two phases. Phase 1 of the continuous clearing mechanism will be implemented on October 4, 2025, while Phase 2 will be launched on January 3, 2026. This staggered approach allows banks and clearing institutions sufficient time to adjust their internal processes and infrastructure.

Impact on Settlement and Realisation

Under the new system, cheque settlement will no longer be restricted to batch timings. Instead, it will occur on a real-time basis upon realisation, significantly reducing delays for customers. This improvement is expected to enhance customer confidence in cheque-based transactions while also promoting faster fund availability across the banking system.

Advisory to Banks and Customers

The RBI has advised all banks to proactively inform customers about the upcoming changes in the cheque clearing process. Clear communication will be essential to avoid confusion and ensure that customers understand the revised settlement timelines. Banks are expected to use multiple channels, including SMS, email, and branch notices, to spread awareness before the phased implementation.

Click Here To Read The Full Circular 

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied