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What is RTGS and how does it work?

What is RTGS and how does it work?

Do you know what RTGS is and why it is important to keep information about it. Nowadays we can do all banking things from home. Now gone are the days when we had to go to the bank and stand in a long line and also have to wait for a long time to transfer our Challan or our simple cash. You can still do it but why waste your precious time when we can do all these things from our home.

Nowadays, there are many modern banking solutions available such as Real Time Total Settlement (RTGS), National Electronic Funds Transfer (NEFT), and Instant Payment Service (IMPS) that make this payment process very easy. With these services, we can conduct our transactions quickly, easily and securely.

So the banking solution that we will know today is RTGS (Real Time Gross Settlement System), which is a very popular electronic money transfer method in India.

Hereby, funds are sent in real time and on an individual basis. RTGS With the help of this, you can send more money simultaneously from one bank account to another bank account. So today you guys will get complete information about what is RTGS and how we can use it in this article then without delay let’s get started and find out what is RTGS and

What is RTGS 

From RTGS in full form there is a real-time aggregate settlement. It is a continuous, real-time process of funds settlement where funds are sent from one account to another on an individual basis and on an order-by-order basis without netting.

If you say in simple language, this is an online banking method where money is sent from one bank to another without any waiting period.

Reserve Bank of India (RBI) This term ‘ in the moment ‘ indicates that it processes all instructions simultaneously as they are received and is not left to be processed at a later time.

The second period total settlement ‘ means that the settlement of the money transfer instructions is done individually (on the basis of individual instructions).

Since RBI maintains this system, all money settlements are entered into their books or records, as RTGS payments are final and irrevocable which means they cannot be made again.

So RTGS is the fastest way to transfer money through secure banking channels. With RTGS you can at least 2,00,000 you can transfer up to Rs and there is no cap, you can transfer money as much as you want, until your bank branch sets a limit for you.

This indicates that the use of RTGS is suitable for more business.

Apart from this, the very important advantage over other money transfer methods is that all these things interbank transfers removes settlement risk and is very secure as it is operated by RBI.

How to do RTGS

This question comes in people’s mind how they can transfer money with the help of RTGS. So the answer is very simple that we can do it in two ways, one is online one way and one offline way. So I will teach you both ways.

Online method for RTGS

For the online method, you can do RTGS using online banking. Hereby, if the person to whom you want to transfer funds must be added to your account as a payee or customer beneficiary.

You have to provide all the information of that customer and then the bank verifies the details of that beneficiary. For this business, it takes about 12-24 hours for the bank to verify the details of the beneficiary.

When the entire verification process is completed by the bank, the beneficiary client is activated by the bank and then you can transfer the funds to that beneficiary client.

To add anyone to your bank account as a beneficiary or payee, you must have the following information related to the beneficiary customer, otherwise you will not be able to add them as a beneficiary through your Internet Banking Account:-

  • Bank name and bank branch
  • Name and account number
  • From their bank IFSC Code (Indian Financial System Code)

Offline method for RTGS

  • If you do not know how to apply online, you can apply it offline as well, but for this you have to actually go to the bank branch and fill out a voucher in the same way you normally do while making a check deposit or NEFT. filling up.
  • Once you make a deposit by filling in the instruction slip, the sending bank feeds the information filled in in the instruction slip to its central processing system.
  • Once fed to the central information processing system, it is sent to the RBI.
  • Then, the RBI completes all the transactions by processing and debiting the amount (money) from the sending bank account and depositing that amount into the bank account for which the RTGS was made.
  • After this whole process a unique transaction number (UTN) is generated, which the RBI sends to the bank sending the amount. The sending bank receiving this UTN means that your money has just been transferred.
  • Once the UTN is received by the sending bank of the amounts, that bank submits its information to the receiving bank and then the receiving bank deposits that amount to the account holder to whom the amount was sent.

This process is about to finish 30 minutes During this period, your RTGS transaction is completed and credited to the beneficiary’s account of the fund.

RTGS transaction features:

Here I will tell you some features related to RTGS transaction, which are very important for you to know:

  • 1. Online money transfer is carried out in real time in this regard
  • 2. It is mainly used for high value transactions
  • 3. It is very safe
  • 4. She is very reliable because she is left behind by RBI who has a hand
  • 5. Immediate clearing will be made in this regard
  • 6. With this, the funds are credited on a one-to-one basis
  • 7. In these transactions they are carried out on an individual and aggregate basis

What are RTGS transaction fees and costs

In this process, the receiving bank (the bank to which the funds are being sent) does not incur any fees for the RTGS transaction. But the sender (who sends the money), the bank charges some fee for the money transfer, something like this:

amount RTGS Fee
From 2 lakh rupees to 5 lakh rupees 30 rupees per transaction
Above up to 5 lakh rupees 55 rupees per transaction

RTGS opening hours

week days 9.00 AM to 4.30 PM
Saturdays 9.00 AM to 2.00 PM

What is RTGS Really Necessary?

If a person is doing daily large transactions, he basically needs RTGS. If seen, it is used more by businessmen because they have to make transactions of higher value several times throughout the day in relation to their business and such high value transactions can only be done through RTGS. But not only them, but RTGS can also be used by ordinary investors or individuals.

If a person ever has to transfer funds of INR 2,00,000 or more from one of their accounts to another or in the account of any other person, they will have to use RTGS to transfer the funds. You can also use RTGS to invest in mutual funds.

What is the main difference between RTGS and NEFT

Standards OIL RTGS
settlements Transactions are settled in batches The transactions are settled individually here.
RTGS time Reconciliation is done here on an hourly basis during the Bank’s business hours. But here all the process is dealt with in real time only.
Transaction Amount There is no minimum here but there is definitely a maximum. There is a minimum of 2 lakh rupees while there is no upper ceiling
Values These are mainly used for low and medium term transactions. While it is used for higher value transactions.

What is the difference between RTGS and NEFT?

In NEFT or National Electronic Funds Transfer, transactions are settled in batches, but RTGS movements are settled individually.

What are the minimum and maximum RTGS transactions?

Always remember that all RTGS transactions are mainly used for large value transactions. Meanwhile, their minimum transaction amount for RTGS is Rs 2 lakh. And it has no upper limit.

How long does it take to transfer funds and credit in RTGS?

Funds are usually deposited instantly. Whereas, the bank imposes a 30-minute time frame for crediting the money.

Does the money recipient receive any confirmation or acknowledgment message once the money is sent to them?

Yes, the SMS recipient receives a confirmation as soon as the funds are received.

If the credit is not credited to the account of the person sent into exile, is the transaction reversed?

Yes. If the transfer of any tax money is not possible, the transaction will be automatically reversed, in such a case the sender gets the money he sent back. If it does not happen within 24 hours or an hour, then you should contact your nearest bank branch.

Is RTGS facility available in all banks in India?

number. RTGS services are available in only a few banks that support RTGS in India.

What is interbank money transfer?

When money has to send money from one bank account to another bank account, it is called interbank money transfer. Basically, this money is sent from one bank to another.

Can an RTGS transaction be scheduled in advance?

How many days in advance can we schedule this transaction?

We can make this transaction 3 working days in advance.

Can we use RTGS to send to foreign banks (overseas)?

number. This service is only available in India and this is also with banks that support RTGS.

How do you know if our bank is running RTGS or not?

For this, you will have to visit the RBI website where you will get a comprehensive list of banks that have RTGS enabled.

Can RTGS transfers be made during public holidays and Sundays?

number. These services are available only on business days, and also during the bank’s business hours.

What did you learn today

I hope I told you what RTGS is? Provide complete information about RTGS I hope you have understood about RTGS.

I ask all readers that you also share this information in your neighborhood, relatives and friends, so that there is awareness among us and everyone benefits from it a lot. I need your cooperation so that I can pass on more new information to you guys.

I have always endeavored to help my readers or readers in all aspects, if you have any doubt whatsoever, you can ask me without any hesitation. I will definitely try to resolve these doubts. For you this article what is RTGS and how did you feel, let us know by writing a comment so that we also get a chance to learn something from your ideas and improve something.

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