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RTGS facility now available 24x7

Real-Time Gross Settlement (RTGS) system for real-time settlement of high-value transactions of Rs 2 lakh and above, became available round the clock from 00:30 hours on December 14, 2020. India is now one of the very few countries where the payment settlement system is available at all times of day and night. 

Until now, the large-value RTGS system was available for customers from 7.00 am to 6.00 pm on all working days of the week except on second and fourth Saturdays of the month.

The Reserve Bank of India (RBI) announced the move on October 8, 2020, of making RTGS available round the clock on all days.

The move was announced one year after the National Electronic Funds Transfer (NEFT) system was made available on a 24x7x365 basis. The NEFT system has been operating smoothly since then and the central bank wants to build on its success. 

The RBI earlier said that the system was made available round the clock to support the ongoing efforts aimed at global integration of Indian financial market, facilitate India’s efforts to develop international financial centres and to provide wider payment flexibility to domestic corporates and institutions, “With this, India will be one of the very few countries globally with a 24x7x365 large value real-time payment system. This facility will be made effective from December 2020,” it added.

What is RTGS?

RTGS is a system where there is a continuous and real-time settlement of fund-transfers, individually on a transaction by transaction basis (without netting), as per RBI. 'Real Time' means the processing of instructions at the time they are received; 'Gross Settlement' means that the settlement of funds transfer instructions occurs individually. Considering that the funds settlement takes place in the books of the Reserve Bank of India, the payments are final and irrevocable.

RTGS vs other modes of funds transfer 

It is a safe and secure system for funds transfer which does not have a cap on the amount being transferred. RTGS is available on all days when most bank branches are functioning, including Saturdays. The remitter, or person sending the funds, need not use a physical cheque or a demand draft. The beneficiary need not visit a bank branch for depositing the paper instruments. Remitter can initiate the remittances from anywhere using internet banking if their bank offers such a service. The transaction charges have been capped by RBI. The transaction has legal backing.

How is it different from NEFT

NEFT is an electronic fund transfer system in which the transactions received up to a particular time are processed in batches. Contrary to this, in RTGS, the transactions are processed continuously on a transaction by transaction basis throughout the RTGS business hours.


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