Real Time Gross Settlement (RTGS)
Real Time Gross Settlement (RTGS) was introduced in the year 2004, is an electronic form of fund transfer where the transfer of money takes place from one bank to another bank on a real-time and gross basis. Reserve Bank of India (RBI) maintains and operates the RTGS system by providing the efficient and faster fund transfer among banks facilitating their financial operations. Therefore, RTGS is the continuous process of settling payments on an individual order basis without netting debits with credits across the books of a central bank (e.g. bundling transactions). Once completed, real-time gross settlement payments are final and irrevocable.
Under RTGS, the settlement means the transaction made are settled as soon as they are processed without any waiting period. ‘ Gross settlement’ means the transaction is settled on one to one basis without bunching or netting with any other transaction. Considering that funds transfer takes place in the books of the Reserve Bank of India, the payment is taken as final and irrevocable.
Advantage of RTGS
The benefits of RTGS given to the customer are as follows:
- Real-time Payment Settlement: Payments settled in real time on a transaction-by-transaction basis, as soon as the system accepts them.
- No Credit Risk: There is no credit and settlement risk involved in RTGS system for receiving participant as each payment transaction is settled instantly.
- Predictability of Cash Flows: RTGS facilitates predictability of cash flows as customers know when their accounts will be debited or credited.
- Benefits to Economy: The instant finality of payments ensures fast, secure and irrevocable settlement of major business and financial market transactions.
Transactions Supported through RTGS
The following are the transactions supported through RTFS system.
- Inter-bank Payments
- Customer Payments
- Own Account Transfers
- Net Clearing
- NDS / CCIL
Information Required for Remittance
The required information that the remitting customer would have to furnish to a bank for the remittance are as follows:
- Amount to be remitted
- Account number which is to be debited
- Name of the beneficiary bank
- Name of the beneficiary customer
- Account number of the beneficiary customer
- Sender to receiver information, if any
- The IFSC Number of the receiving branch.
Transaction Process involved in RTGS
The transaction process involved in RTGS is explained below in step by step procedure.
Step 1: The customer has to submit the outward Instruction slip.
Step 2: The verification of Instruction slip (Clear funds, name and a/c no. of the customer, IFSC code, signature) take place.
Step 3: The branch scans the Instruction slip and sends it to the RTGS Central Team.
Step 4: The branch will file the slip to maintain records.
Step 5: The RTGS Central Team executes the transaction in Finacle and Participant Interface (PI) of RTGS.
Step 6: Then the message moves to the Reserve Bank of India (RBI) Server.
Step 7: The bank’s RTGS Settlement Account is debited, and the beneficiary Bank’s RTGS Settlement Account is credited.
Step 8: The beneficiary Bank passes the credit to the beneficiary customer’s account.
RTGS Service Availability Durations
RTGS transactions will be forwarded to RBI based on the following schedule:
|Day||Start Time||End Time|
|Monday to Friday||9:00 am||4:00 pm|
|Saturday||9:00 am||1:30 pm|
Note: The RTGS transactions will have slight variations in the transaction processing time depending upon the various bank.
Limit for RTGS Transactions
|RTGS||Rs.2 lakh||No limit|
Note: The maximum amount will vary depending upon the various banks.
The processing charges or service charges for RTFS transactions are tabulated below:
|RTGS||From Rs.2 lakh up to Rs.5 lakh||Not exceeding Rs.30/-|
|From Rs.5 lakh and above||Not exceeding Rs.55/-|
Volume and Value of Transactions
On a typical day, RTGS handles about transactions a day. Approximate value of turnover Rs.1,50,000 crores per day. Around 33000 branches at more than 3,000 cities/ towns and taluk places are covered under the RTGS system.
Track the remittance transaction
Tracking system depends on the arrangements made between the remitting customer and the remitting bank. Some banks with internet banking facility will offer this service.
Once the funds are credited to the beneficiary bank account, the remitting customer gets intimation from his bank either by a registered e-mail or by a message on the mobile
Delay or Non-credit
If the amount transacted by the customer is not credited to the payee account in such cases, the customer can contact bank or branch to resolve their issue.
If the issue is not solved satisfactorily, the Customer Service Department of RBI may be contacted.