With the digitisation of financial services, money transfer has become fast and convenient. One such method to transfer money is RTGS. RTGS stands for real-time gross settlement. Under the RTGS system, funds are transferred instantly from your account to the account of the beneficiary, as soon as you issue the instructions.
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What is RTGS?
According to the RBI, RTGS is ‘a system where there is a continuous and real-time settlement of funds, individually, on a transaction-by-transaction basis, without netting’.
Real-time settlement of funds means money is transferred from the source to the receiver as soon as the instruction is issued. There is no waiting period in this transaction. In short, RTGS transfers are used for fund transfers that require immediate clearance.
Meant for high-value fund transfers, RTGS enables fund transfers on a transaction-by-transaction basis, i.e., multiple transactions are not grouped.
In India, the RTGS system is run and managed by the Reserve Bank of India (RBI). Since RTGS transfers find a mention in the books of the RBI, they are irrevocable and final.
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RTGS benefits
- Safe and secure fund transfer.
- No capping of amount transfer (The account holder can set his/her own funds-transfer limit).
- Available all day, every day.
- Real-time transfer of funds.
- No need for a physical visit or paper.
RTGS processing fee
From July 01, 2019, processing charges for inward RTGS transactions have been waived. However, on money sent outside, the RTGS charges are as follows:
- Rs 2 lakh to Rs 5 lakh: Up to Rs 24.50
- Over Rs 5 lakh: Up to Rs 49.50
Details to be provided for RTGS
- Amount
- Source account number
- Name of beneficiary
- Account number of beneficiary
- Name of the beneficiary bank, branch and IFSC code
- Sender to receiver information, if any.
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Time taken in RTGS transfer
It takes nearly 30 seconds for the funds to reach the account of the beneficiary, if the money has been transferred through RTGS. In case of any failure, the money transferred returns to the source within one hour. If there is any delay in refund, the customer is eligible to receive compensation at the current repo rate plus 2%.
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Preconditions for RTGS transfer
For an RTGS transfer to take place, both, the sending bank branch and the receiving bank branch must have the RTGS facility enabled. According to the RBI data, there are over 1,65,000 RTGS-enabled bank branches in India at present. The sender must also have the beneficiary’s name, account number and account type, bank branch name and the IFSC.
Information needed for RTGS payment
- Amount to be remitted
- The account number from which money will be debited
- Name of the beneficiary bank and branch
- IFSC number of the receiving branch
- Name of the beneficiary
- Account number of the beneficiary
- Sender to receiver information, if any
- Sender and beneficiary legal entity identifier (for eligible transactions)
How to initiate RTGS transaction?
You can initiate an RTGS transfer through online and offline mode. For offline mode, you will have to visit your bank branch and issue the instructions. To do so online, you can use mobile banking or internet banking facilities.
Precautions to take before RTGS transfer
- RTGS transactions take place solely based on the account number of the beneficiary. Make sure you input the right account number.
- RTGS system does not accept post-dated transactions.
How to track RTGS transfers?
Customers do not have any facility to track an RTGS transaction. However, the beneficiary bank sends a message to the receiving bank through RBI that the money has been credited to the beneficiary account. The sender can get in touch with his bank to get this information.
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FAQs
What is RTGS full form?
RTGS stands for Real-Time Gross Settlement.
Is RTGS available 24x7?
With effect from December 14, 2020, RTGS services are available on all days, 24x7.
What is the minimum amount that can be transferred through RTGS?
The minimum amount to be transferred through RTGS is Rs 2 lakhs.
Can I schedule an RTGS transfer in advance?
No, you cannot schedule an RTGS transfer in advance.
What is the UTR number?
The unique transaction reference (UTR) number is a 22-digit code used to identify a transaction in the RTGS system.
What is the maximum amount that can be transferred through RTGS?
There is no maximum limit.
Is it possible to cancel an RTGS transaction?
After an RTGS transaction is started, it cannot be cancelled. If the transaction fails due to any technical issues, funds will be refunded to your account.
Is it necessary to have an RTGS-enabled bank account to receive funds through RTGS?
Yes, it necessary to have an RTGS-enabled bank account to receive funds through RTGS.
