Receiving checks used to take 2 to 3 business days, but now takes 5 to 7 business days | Photo credit: ROY CHOWDHURY A
Businessmen and individual customers of banks continue to face delays in check cashing even ten days after the introduction of the same day check cashing facility introduced by the Reserve Bank of India (RBI) on October 4, 2025.
There are delays in clearing checks, which used to clear in two to three business days in the previous system but now take five to seven days.
“As per feedback from our Micro, Small and Medium Enterprise (MSME) members and others, check clearing will take around five days after the introduction of the new facility. MSMEs continue to use checks for various financial transactions,” Rachakonda Ravi Kumar, president, Federation of Telangana Chambers of Commerce and Industry (FATCCI) told reporters. business line on Tuesday.
According to Ravi, if the checks bounce due to software glitches, it could impact the credit score of MSMEs.
The problem has been noticed across states in the country’s unified banking system. Senior officials of banks including State Bank of India, Canara Bank and Union Bank of India confirmed delays in check clearance on condition of anonymity.
Banks have check transactions with thousands of millions of corporate customers, and the issue of bounced checks is causing a lot of pain, according to bankers.
A senior banker at the Delhi branch of a PSU bank admitted that there were glitches and delays in the check clearing process since the introduction of the RBI’s new Continuous Clearing last week.
“Currently, we have pending checks since October 9 that have yet to be cleared. According to the clearing officials in charge, the problem is because some banks’ software is still not prepared for the new clearing system,” he said.
Apparently many customers have experienced problems with the new check clearing system. VT Gokhale, lawyer and former investment banker, narrated his experience with the new check shortening system: “I had dropped a check from my account at Dombivli (East) branch of Bank of India for ₹3,000 in the post box of Dombivli (East) branch of IDBI Bank on October 4 and the amount got into IDBI bank account only on October 10 credited.”
According to sources, the RBI, which tested the new system for a year before its rollout, has taken stock of the situation and is working closely with NPCI and the banks to ensure smooth clearing of checks within a day and without any delay.
BR Ganesh Rao, president of the Karnataka Small Scale Industries Association (KASSIA), said, “We are receiving distress calls from MSMEs across Karnataka as clearance of checks is now taking up to a week and some are even being bounced without any reason.”
“These delays are stifling cash flows, slowing production and hurting small entrepreneurs, especially in semi-urban and rural areas where checks remain the main means of payment,” he added.
‘Most issues resolved’
In a statement on Tuesday, the National Payments Corporation of India (NPCI) said that after the implementation of the new system, a total of 1.49 crore instruments, amounting to ₹8,49,557 crore, have been cleared and processed through the central system.
“During these initial days, we have encountered some teething problems, both at NPCI’s central system and at participating banks, resulting in delays in clearing and crediting customers’ accounts, and a large number of returns,” the report said.
“Most of these issues have now been resolved and the central system has been stable since Monday, October 13, 2025. NPCI is working with the banks to address any remaining issues to ensure that the checks presented can be credited the same day,” it added.
“We are receiving distress calls from MSMEs across Karnataka as clearance of checks is now dragging on for up to a week, and some are even being returned without any reason,” said BR Ganesh Rao, president of the Karnataka Small Scale Industries Association (KASSIA).
“These delays are stifling cash flows, slowing production and hurting small entrepreneurs, especially in semi-urban and rural areas where checks remain the main means of payment,” he added.
With inputs from KV Kurmanath/Hyderabad, Sindhu Hariharan/Chennai and Jyoti Banthia/Bengaluru
Published on October 14, 2025
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