We at Finakon track the regulatory changes. We also use AI to create a summary. We are providing a quick overview of the RBI circulars on a weekly basis on our website. The summary is neither exhaustive nor comprehensive. For accurate information, users shall refer to the original circular of the regulator. Finakon shall not be responsible for inferences drawn based on the summary provided.
RBI Introduces Continuous Clearing in Cheque Truncation System — Faster Access to Funds for Customers
The Reserve Bank of India (RBI), through its circular dated August 13, 2025, has announced a major upgrade to the Cheque Truncation System (CTS). This change will shift cheque processing from the current batch-based settlement to a continuous clearing and settlement on a realisation model — ensuring faster credit to customers and quicker identification of dishonoured cheques.
Rollout Plan:
- Phase 1 (Oct 4, 2025): Cheques to be confirmed by banks by 7:00 PM the same day.
- Phase 2 (Jan 3, 2026): Cheques to be confirmed within 3 hours of presentation.
How It Works:
- Cheques scanned and sent to the clearing house instantly (10 AM–4 PM).
- Drawee banks confirm in real time; hourly settlements from 11 AM onwards.
- Presenting banks must credit customers within 1 hour of settlement.
Impact: This move will drastically reduce cheque clearance times, ensure faster fund availability, and improve efficiency in the banking system.
RBI Eases Norms for International Trade Settlement in INR
The Reserve Bank of India (RBI), through its circular dated August 5, 2025, has further simplified the process for settling international trade in Indian Rupees (INR).
Authorised Dealer (AD) Category-I banks can now open Special Rupee Vostro Accounts (SRVAs) of overseas correspondent banks without prior RBI approval. This move is effective immediately and aims to promote the use of INR in cross-border trade, making transactions faster and more efficient.
RBI Allows Overseas Rupee Balances to be Invested in Government Securities
The Reserve Bank of India (RBI), via its circular dated August 12, 2025, has permitted persons resident outside India holding Special Rupee Vostro Accounts (SRVAs) for international trade settlement to invest their surplus rupee balances in Central Government Securities, including Treasury Bills.
This move, effective immediately, is part of RBI’s updated Master Direction on non-resident investment in debt instruments and aims to enhance the use of the Indian Rupee in global trade while offering secure investment avenues for overseas partners.
