Hello friends, today we are going to share everything aboutReal Time Gross Settlement -RTGS.
What is RTGS:-The acronym ‘RTGS’ stands for Real Time Gross Settlement. RTGS system is a fund transfer systems where transfer of money or securitiestakes place from one bank to another on a “real time” and on “gross” basis. Settlement in “real time” means payment transaction is not subjected to any waiting period.
The transactions are settled as soon as they are processed. “Gross settlement” means the transaction is settled on one to one basis without bundling. Once processed, payments are final and irrevocable. RTGS systems are typically used for high-value transactions that require immediate clearing.
Minimum / maximum amount for RTGS transactions:- The RTGS system is primarily meant for large value transactions. The minimum amount to be remitted through RTGS is Rs.2 lakh. There is no upper ceiling for RTGS transactions.
Time taken for effecting funds transfer from one account to another under RTGS:-Under normal circumstances the beneficiary branches are expected to receive the funds in real time as soon as funds are transferred by the remitting bank. The beneficiary bank has to credit the beneficiary’s account within 30 minutes of receiving the funds transfer message.
Timings of RTGS service window is available:-The RTGS service window for customer’s transactions is available to banks from 9.00 hours to 16.30 hours on week days and from 9.00 hours to 14:00 hours on Saturdays for settlement at the RBI end. However, the timings that the banks follow may vary depending on the customer timings of the bank branches.
Processing Charges / Service Charges for RTGS transactions:-
a) Inward transactions – Free, no charge to be levied.
b) Outward transactions – `Rs.2 lakh to Rs. 5 lakh – not exceeding Rs.30.00 per transaction;
Above Rs.5 lakh – not exceeding Rs.55.00 per transaction.
The information that the remitting customer has to furnish to a bank for initiating a RTGS remittance:-
- Amount to be remitted
- Remitting customer’s account number which is to be debited
- Name of the beneficiary bank and branch
- The IFSC Number of the receiving branch
- Name of the beneficiary customer
- Account number of the beneficiary customer
- Sender to receiver information, if any
Difference between RTGS and National Electronics Funds Transfer System (NEFT):-NEFT is an electronic fund transfer system that operates on a Deferred Net Settlement (DNS) basis which settles transactions in batches. In DNS, the settlement takes place with all transactions received till the particular cut-off time whereas in Timings of RTGS service window is available:-. For example, currently, NEFT operates in hourly batches. [There are twelve settlements from 8 am to 7 pm on week days and six settlements from 8 am to 1 pm on Saturdays.] Any transaction initiated after a designated settlement time would have to wait till the next designated settlement time Contrary to this, in the RTGS transactions are processed continuously throughout the RTGS business hours.
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