Finance minister’s ‘two-hour deposit’ claim falls flat as customers wait days for funds

Despite the announcement from October 4 that cheque deposits would be credited within just two hours, account holders are still waiting four to five days for their funds. 

This delay has caused mounting frustration among customers ahead of Diwali, disrupting their financial planning, including the timely payment of salaries. Even after the salary due dates have passed, the money remains uncredited, highlighting flaws in the bank clearing system.

For example, a cheque deposited at Punjab National Bank on Monday was debited from the issuer’s account on Tuesday, yet the funds had not been credited by Thursday. Similarly, Indian Overseas Bank account holders are also facing delays. 

Many banks are advising customers to contact their head offices, while customers initially assumed these were temporary issues and refrained from widespread complaints. In reality, cheque amounts are now taking two to four days—or even longer—to be credited, far from the promised two hours.

In Ahmedabad’s Science City area, an account holder deposited three to four cheques totalling ₹26 lakh four days ago. Although the issuing banks debited the amounts, the funds have still not appeared in the recipient’s Bank of Baroda account after six days. When contacted, the branch manager advised the account holder to reach out to the bank’s head office for further details.

Meanwhile, bank employees are required to stay at branches until midnight, even on the fifth day of concent clearing. There is no certainty regarding how much cash must be reserved for clearing purposes. Previously, all cheques cleared before 7 pm, allowing staff to cover shortfalls from their own private bank funds. Now, since banks close at 7 pm, larger reserves must be kept aside to avoid any shortages. Where typically ₹2 crore would be reserved for clearing, current requirements have risen to ₹3–4 crore. This has raised concerns about potential violations of the Cash Reserve Ratio (CRR), which mandates that banks maintain 3% of total deposits with the RBI.

NPCI held responsible for delays

Banks are hesitant to continue with concent clearing due to these operational challenges. They have reportedly used the delay in crediting funds for their own purposes, which makes the new two-hour clearing system inconvenient. Banks are attributing these issues to the National Payments Corporation of India (NPCI) and are instead encouraging the use of RTGS, NEFT, and digital payment systems.

Some banks have even sent messages to customers explaining that technical glitches at NPCI have caused delays in the Cheque Truncation System. Customers are being advised to use digital payment methods to make timely transactions in the interim.