Business

RBI Plans Major Overhaul To Speed Up Cheque Clearing Process

The Reserve Bank of India (RBI) is set to significantly accelerate cheque clearing times, with plans to reduce the process to just a few hours, RBI Governor Shaktikanta Das announced on Thursday.

Currently, the Cheque Truncation System (CTS) operates on a batch processing basis, with a clearing cycle that can take up to two working days. The RBI’s new proposal aims to overhaul this system by implementing continuous clearing with ‘on-realisation-settlement’ in CTS. This upgrade is expected to ensure that cheques are cleared within hours on the day they are presented.

“This initiative will streamline cheque payments, benefiting both payers and payees by speeding up the settlement process,” Das explained.

Also Read: President Droupadi Murmu Urges For Deep Education Relationship Between India, New Zeeland

Cheque truncation replaces the traditional physical movement of cheques between banks with electronic images. Instead of sending the physical cheque, banks transmit an electronic image through the clearing house, which includes essential details such as the MICR band, presentation date, and presenting bank information. This shift reduces the need for physical cheque transport, cutting costs and speeding up the collection process.

The CTS framework enables faster and more cost-effective fund realization compared to traditional methods. Under the new grid-based CTS clearing system, cheques drawn on branches within the same grid are processed as local cheques, eliminating outstation collection charges even if the banks are in different cities but within the same CTS grid.

Richa Kaushik

Recent Posts

Yemen’s Houthis Claim Responsibility For Missile Attack On Israel

Yemen's Houthi group has claimed responsibility for a missile attack on Israel's Negev region, targeting…

3 hours ago

From ‘Razia Sultan’ To ‘Sarfarosh’: The Timeless Journey Of Nida Fazli, ‘Main Nida’

A special screening of the film 'Main Nida', based on the life of the renowned…

3 hours ago

Flood Alert In PoK’s Muzaffarabad After Alleged Jhelum Water Release

A flood alert was issued across Muzaffarabad on Saturday after locals reported a sudden rise…

4 hours ago

Zelensky, Trump Hold Talks In Rome Ahead Of Pope’s Funeral; Discuss Ceasefire & Peace

US President Donald Trump and Ukrainian President Volodymyr Zelensky met in Rome on Saturday ahead…

5 hours ago

Pahalgam Terror Attack: Ishan Educational Institutions Organises Protest Against Terrorism

Ishan Educational Institutions, Greater Noida, today organised a peaceful protest march condemning the recent terror…

6 hours ago

Complete Ban On Drone Flights Over Noida International Airport ‘Red Zone’

Authorities have imposed a complete ban on the operation of drones and UAVs over and…

6 hours ago