Automated Cheque Clearance and Instant Settlement System using Hybrid OCR and Banking API Orchestration

Saravanan C
Mtech Data Science ,Department of Computer Science and Engineering,
SRM Institute of Science and Technology
Guided by Dr. Shanmugam
Professor, SRM Institute of Science and Technology (SRMIST)

Abstract:Cheque-based transactions remain a critical component of high-value payments in the Indian banking ecosystem.However, conventional cheque clearing through the Cheque Truncation System (CTS) introduces settlement delays ranging from 24 to 48 hours. This paper presents a fully automated cheque clearance and instant settlement system using a hybrid Optical Character Recognition (OCR) approach combined with secure banking API orchestration. The proposed system integrates Tesseract OCR for machine-printed fields and EasyOCR for handwritten text extraction. Extracted data is validated and processed through IMPS, NEFT, or RTGS channels in real time. Experimental evaluation across multiple Indian bank cheque formats demonstrates an average end-to-end processing time of 1.45 seconds with extraction accuracy exceeding 95%, significantly improving liquidity, operational efficiency, and fraud mitigation.
Keywords:Cheque Processing, Optical Character Recognition, Banking APIs, IMPS, NEFT, RTGS, FinTech Automation