Faster Funds Ahead: HDFC, ICICI Launch Same-Day Cheque Clearance Under RBI Guidelines
Banks have advised customers to maintain adequate account balances to prevent cheque bounce and ensure that all cheque details are correctly filled to avoid processing delays or rejections.
Private banks such as HDFC Bank and ICICI Bank are set to implement same-day cheque clearance starting October 4, marking a significant step towards faster and more secure payments in India.
The move follows the Reserve Bank of India's (RBI) updated settlement framework, designed to enhance the efficiency of cheque processing and reduce delays for customers, reported IANS.
How the New System Works
Under the new system, cheques deposited from October 4 will be cleared within a few hours on the same day. Banks have advised customers to maintain adequate account balances to prevent cheque bounce and ensure that all cheque details are correctly filled to avoid processing delays or rejections.
A key feature of the new system is the Positive Pay System, which strengthens cheque security. Account holders depositing cheques exceeding Rs 50,000 must submit details including account number, cheque number, date, amount, and beneficiary name at least 24 working hours prior to depositing.
Banks will verify the details against the presented cheque. If the information matches, the cheque will be cleared; otherwise, it will be rejected, requiring resubmission by the drawer.
Customers are required to email cheque details to specific regional addresses provided by their banks. Once the bank receives the details, it will send an acknowledgement message confirming receipt before processing. This process ensures transparency and reduces the risk of errors or fraud.
Cheque Truncation System and Efficiency Gains
The Cheque Truncation System (CTS), currently in use, allows banks to send an electronic image of the cheque and its details to the drawee bank, eliminating the need for physical cheque movement. Previously, cheques deposited via drop boxes or ATMs took up to two working days to clear. With same-day clearance, customers will experience significantly faster access to funds.
Positive Pay Requirements and Protection
The RBI has made the Positive Pay System mandatory for cheques above Rs 5 lakh, while it is strongly recommended for cheques above Rs 50,000. Cheques verified through Positive Pay are also protected under the RBI’s dispute resolution mechanism, giving customers added security and confidence in the system.
The RBI's plan for continuous clearing and settlement will roll out in two phases. Phase 1 begins on October 4, 2025, while Phase 2 is scheduled for January 3, 2026. This phased approach allows banks and customers to adapt gradually to the faster cheque clearance process while ensuring smooth operations.
Key Customer Guidelines
To ensure seamless processing, customers must pay attention to the following guidelines:
Ensure the amount in words and figures matches.
Verify the cheque date is valid.
Avoid overwriting in the payee’s name or amount.
Ensure the drawer’s signature matches the bank records.
Banks have emphasised that careful adherence to these requirements will prevent delays or cheque rejection, facilitating a smoother experience for all account holders.
With same-day clearance, banks aim to bridge the gap between traditional cheque transactions and the fast-paced demands of modern banking, ensuring that customers have timely access to their funds while minimising the risk of fraud and errors.
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