 "RBI MPC proposes process to speed up clearance of cheques in a few hours")
The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) has proposed clearing cheques in just a few hours, broadening efforts to improve customer service at banks.
Cheques will be scanned, presented, and passed in a few hours and on a continuous basis during business hours, said RBI Governor Shaktikanta Das.
Clearing through the cheque truncation system (CTS) operates in a batch-processing mode, with a clearing cycle of up to two working days. The RBI proposed to expedite the process by introducing continuous clearing with 'on-realisation-settlement' in CTS. This will allow cheques to be cleared within a few hours on the day they are presented.
“The clearing cycle will be reduced from the present T+1 days to a few hours. Detailed guidelines in this regard shall be issued shortly,” said Das.
“This measure will significantly enhance the efficiency of cheque-based transactions, leading to faster crediting of funds for both individuals and businesses. For account holders, this means improved liquidity and the ability to manage urgent payments more effectively. Businesses will benefit from quicker access to funds, facilitating smoother operations and better financial planning. Overall, this move by the RBI is set to improve customer service and streamline banking processes, offering a more efficient and responsive banking experience,” said Adhil Shetty, chief executive officer of Bankbazaar.com
Separately, the RBI enhanced the limit for tax payments through Unified Payments Interface from Rs 1 lakh to Rs 5 lakh per transaction.