Reserve Bank of India (RBI) Postpones Phase 2 of Continuous Cheque Clearing Mechanism

Key facts

• The Reserve Bank of India (RBI) postponed the implementation of the second phase of the 'Continuous Clearing and Settlement on Realisation in Cheque Truncation System' to allow banks to streamline operations.
• The second phase of the faster cheque clearance mechanism was originally scheduled for implementation on January 3.
• The first phase of the clearing system implementation commenced on October 4.
• Under the second phase, banks are required to clear cheques within three hours of realisation in the Cheque Truncation System (CTS).
• The RBI modified the presentation session timing to 9 am to 3 pm and the confirmation session timing to 9 am to 7 pm.
• The previous presentation session was scheduled from 10 am to 4 pm, while the confirmation session was from 10 am to 7 pm.
• In Phase 1, drawee banks must confirm cheques by 7 pm, or they are deemed approved and included for settlement.
• The new process replaces the previous cheque clearing cycle of up to two working days with a system that clears cheques within a few hours of presentation.
• The item expiry time for cheques in Phase 2 was set to be changed to T+3 clear hours.