RBI defers fast cheque clearance rollout, full implementation likely next financial year

The Reserve Bank of India has postponed the second phase of its plan to process cheques within hours, citing technical and operational challenges faced by banks.

The Reserve Bank of India (RBI) has made a key announcement, deciding to defer the second phase of its fast cheque clearance system. The move comes amid technical and operational hurdles faced by banks in implementing quicker cheque processing.

The first phase of the new cheque clearance framework came into effect on October 4, 2025. Under this phase, banks began clearing cheques on the same day of deposit, instead of processing them the following day, as was done earlier.

The second phase, which aimed to further speed up the process, was scheduled to be rolled out from January 3. However, the RBI has now postponed its implementation due to technical reasons. Officials indicated that the system may now be implemented from the next financial year, giving banks additional time to prepare.

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Earlier as well, the RBI had deferred the rollout after banks informed the regulator that they were not fully prepared. Several banks had sought more time to upgrade systems and streamline operations. During the initial phase, banks faced challenges in clearing cheques quickly, primarily due to staff shortages and operational constraints.

To address these issues and revive and stabilise banking operations, the RBI has decided to allow banks more time before enforcing stricter timelines for cheque clearance.

Traditionally, cheques deposited in banks were processed only on the next working day. To modernise and speed up this system, the RBI introduced new rules to ensure faster cheque clearance within hours. As part of the first phase, the cheque clearing window was expanded from 10 am-4 pm to 9 am-7 pm, enabling same-day clearance.

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Looking ahead, the RBI is expected to introduce a three-hour cheque clearance system in the next financial year, once banks are operationally ready and technical issues are resolved.