Cheque Clearing in Few Hours! RBI launches Continuous Cheque Clearing

The Reserve Bank of India (RBI) has launched Continuous CTS Cheque Clearing. Now, Cheques will be cleared in just a few hours. RBI has decided to transition CTS 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.

RBI Guidelines on Continuous Clearing with Settlement On-realisation in CTS

1. Single presentation session with continuous delivery:

There shall be a single presentation session from 10:00 AM to 4:00 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.

2. Continuous inward processing and confirmation by banks:

The confirmation session shall start at 10:00 AM and close at 7:00 PM.

For every cheque presented, the drawee bank shall generate either positive confirmation (for honoured cheques) or negative confirmation (for dishonoured cheques).

Each cheque will contain the ‘Item Expiry Time’ which indicates the latest time by which confirmation for the presented instrument needs to be provided by the drawee bank.

Processing by drawee banks is to be done continuously throughout the day and on a real time basis as soon as cheque images are received.

Information of positive/negative confirmation shall be sent by the drawee banks to the clearing house immediately after processing.

3. Time available for inward processing:

During phase 1 (From October 4 to January 2, 2026), drawee banks shall be required to confirm (positively / negatively) cheques presented on them latest by end of confirmation session (i.e. 7:00 PM) else those will be deemed to have been approved and included for settlement. Item expiry time for all cheques shall be set as 7:00 PM in phase 1.

In Phase 2 (from January 3, 2026), the item expiry time of cheques shall be changed to T+3 clear hours. For example, the cheques received by drawee banks between 10:00 AM and 11:00 AM will have to be confirmed positively or negatively by them by 2:00 PM (3 hours from 11:00 AM). Cheques for which confirmation is not provided by the drawee bank in the prescribed 3 hours shall be treated as deemed approved and included for settlement at 2:00 PM.

4. Settlement on realisation:

No accounting entries (settlement) will be posted for presentation of cheques.

Starting from 11:00 AM, settlement will be arrived every hour till the end of confirmation session, based on the positive confirmations received from drawee banks and cheques considered deemed approved.

No accounting entries shall be passed for cheques with negative confirmation.

5. Releasing payment to customers:

On completion of settlement, clearing house shall release the information of positive and negative confirmations to the presenting bank.

The presenting bank shall process the same and release the payment to the customers immediately, but not later than 1 hour from successful settlement, subject to usual safeguards.

Download RBI Circular on Continuous Clearing

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RBI enhances security features for cheques above ₹50,000: How it will work

Reserve Bank of India (RBI) today announced that it plans to introduce a mechanism called 'Positive Pay' in order to enhance safety features of cheques of value ₹50,000 and above.

The announcement by RBI Governor Shaktikanta Das came in order to keep consumer safety in focus and to lower the cases of fraud and abuse with respect to cheque payment.

Under the mechanism all cheques will be processed for payment by the drawee bank based on information passed on by its customer at the time of issuance of cheque.

Operational guidelines in this regard will be issued separately, Das said.

“Positive Pay is essentially an automated fraud detection tool. Very simply, it matches specific information related to the cheque presented for clearing, such as the cheque number, cheque date, payee name, account number, amount, and other details against a list of cheques previously authorized and issued by the issuer. Unless all the specified components of the cheque match exactly, the cheque will not be cleared," 

How will sitive Pay Mechanism work?

Under the Positive Pay system, an account holder shares the details of issued cheque to bank like Cheque Number, Cheque date, Payee name, Account number, Amount etc along with an image of the front and reverse side of the cheque, before handing it over to the beneficiary.

When the beneficiary submits the cheque for encashment, the cheque details are compared with the details provided to the bank through Positive Pay. If the details match, the cheque is honoured.

This will cover approximately 20% and 80% of total cheques by volume and value, respectively, RBI said in a statement.

On the other hand, ICICI Bank already offers this feature since 2016 via its iMobile application.

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Cheque Truncation System or CTS 2010

What is Cheque Truncation System or CTS 2010 :

The full form of CTS is Cheque Truncation System.  RBI has decided to launch this system and all banks across India are required to follow RBI guidelines in this regard.  As per RBI guidelines, now all banks have to issue cheques conforming to the CTS 2010 standards with uniform features.

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