Jamshedpur businesses reel under cheque clearance turmoil

Mail News Service

Jamshedpur, Oct 15: The Reserve Bank of India’s (RBI) new “same-day cheque clearance” rule, introduced from October 4, was meant to make transactions faster and more transparent.

But for hundreds of traders, small business owners, and even ordinary account holders in Jamshedpur, the move has turned into a daily struggle, with delays, technical snags, and confusion replacing the promised speed.

The new regulation mandates that cheques deposited within the prescribed time should be processed and settled multiple times during the day, instead of the earlier next-day system.

However, in Jamshedpur  a city where cheque payments are still common among traders and industrial suppliers  the system seems to be stuttering.

“I deposited a cheque from my client in my Bank of India account on Monday morning. The bank assured me that the amount would reflect by evening but it was not yet credited till today ( Wednesday) ,” said  a businessman who runs a private agency in Jamshedpur.

He said this is the festive season. “We need liquidity every day, but the new process is causing cash flow problems,” he pointed out.

Similar concerns are being raised by contractors and vendors supplying to small and medium industries in Adityapur and Burmamines who are facing similar problems ever since the new regulation was implemented from October 4 as cheques are awaiting clearances.

“Our clients mostly issue cheques. Earlier, I could plan payments based on next-day credit. Now there’s no certainty. Sometimes cheques get rejected because of scanning errors,” revealed Ankit Agarwal, a local trader.

Bank officials admit there have been “teething issues” with the rollout.

“The new system depends on accurate digital scanning and high-speed processing. If a cheque image is unclear or a signature mismatch occurs, it gets flagged for manual verification, delaying settlement,” said an official of IDBI Bank , requesting anonymity.

Public sector banks are facing similar hiccups. A manager at SBI’s Bistupur branch said, “The intention behind the RBI’s new regulation is positive. But system upgrades and training are taking time. We’ve requested additional technical support to handle the workload.”

The Singhbhum Chamber of Commerce and Industry  (SCCI ) has also written to regional bank authorities highlighting the impact on small traders.

“The system was supposed to help business, but due to initial glitches, payments are stuck. The festive season is the worst time for such disruptions,” said a SCCI official.

A former banker remarked that the glitches in same-day cheque clearance are merely transitional and will be ironed out soon.

“The erstwhile system of regional clearing houses has been phased out, giving way to a unified, single-window mechanism for cheque settlement. Banks are currently in the process of adapting to this new regulatory framework, and operational stability will follow shortly,” he stated.

Bank unions too have voiced concerns, citing software integration issues and short-staffing in several branches.

Customers have reported cheques being “returned” for reasons like unclear MICR scans or incomplete Positive Pay verification — errors that were rare under the older system.

However, experts believe these disruptions are temporary. “Any transition at this scale brings short-term friction.

Once banks fully calibrate systems and customers adapt, the benefits will show,” said financial analyst Arindam Sen, who tracks banking trends in Jharkhand.

Until that happens, both businessmen and ordinary customers in Jamshedpur are finding themselves caught in a cash crunch — waiting for a system designed to make payments faster, to actually catch up with its own promise.