RTGS full form – How RTGS Works & Features of RTGS Transaction

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RTGS full form and How RTGS Works: Are you looking forward to transferring money by RTGS? Do you want to know what RTGS is? Then you have been reached at the correct place. Here, we will provide you complete information about RTGS full form and RTGS.

RTGS stands for Real Time Gross Settlement is a system in basically a unique system in which the transfer of money or securities takes place from one time to another on a real time as well as the gross basis.

RTGS full form – How RTGS Works & It’s Services

RTGS Full Form

RTGS systems are basically high-value transactions that need and receive instant cleaning. In various countries, RTGS is the only way to get direct funds on the same day and that’s why they are used only when you want to clear funds. While in most of the cases, all the regular payments are not done by RTGS system but done using the national payment system or simply a network which allows all the participants to transfer funds.

How does the RTGS work?

In RTGS, the processing of standing instructions is being done at immediately as soon as the instruction is received instead of being done in batches or later. All the transaction will have different instructions and they will be done at scheduled time. All the fund transfers are being operated by the Reserve Bank of India.

Recently, in 2016, the Government has launched the UPI app, using which one can transfer money from one account to another instantly. Before which, NEFT and RTGS were the only way to which you will be able to transfer money instantly.

In order to transfer money with RTGS, sender’s, as well as recipient’s IFSC code, is required without which you will not be able to transfer money. IFSC code is basically an 11 Digit Alpha Numeric code is unique and is provided by the RBI for any bank which operates under the RTGS and NEFT network all over the country.

Features of RTGS Transaction

Some of the main features of the RTGS Transactions that everyone should be aware of

  1. Sender’s, as well as Receiver’s IFSC code and Account number, are must to transfer funds.
  2. While doing RTGS Transaction, a minimum of 2 lakhs rupees has to be transferred.
  3. On any day a maximum transaction of Rs 10 lakh can be done via RTGS.
  4. All the transactions that are done using the RTGS can be lined well in advance, mainly for all the important payments such as tax, hedge transactions or any cash management transfer.
  5. All the planning of the funds varies from a particular bank to bank and the main purpose of transferring the money.
  6. All the transfers that are being approved by the RBI will be transferred within 30 minutes of the request.
  7. Due to some reason, if the money is not credited to the receiver’s bank, then it will be credited back to the sender’s bank.

Fees and Charges

During the RTGS Transaction, the bank doesn’t charge anything from the recipient. While from the sender, there are fixed charges on the basis of the transaction amount be transferred as follows:

  1. On all the Transaction Between Rs 2 Lakh to Rs 5 Lakh: Rs 25 + Service Tax will be applicable.
  2. On all the Transaction Between Rs 5 lakh to Rs 10 Lakhs: Rs 30 + Service Tax will be applicable.

FAQs on RTGS

What is the Maximum time for returning the RTGS transactions, if the money is not credited to the receiver’s account?

If the funds are not credited to the receiver’s account due to any reason such as Account closed, Account not exist, etc the money will be credit back in the originated bank in just 24 hrs or within the RTGS business day whichever is faster.

Can a RTGS Transaction Schedule in Advance?

Yes, RTGS Transaction can easily be scheduled before time.

What is the actual time frame to schedule an RTGS Transaction?

The time frame in which a RTGS Transaction can be advanced is 3 working days. Using RTGS, you can pay for transactions such as:

  • Loan
  • Interest
  • Hedging
  • Securities
  • Tax payment
  • Trade
  • Trade Settlement Payment
  • Value Added Tax Payment
  • Cash Management Transfer
  • Supplier Payment

What are the working hours for RTGS Service?

The RTGS Service window is available for all the customer transactions from 9:00 hours to 16:30 hours from Monday to Friday and from 9:00 hours to 14:00 for arrangement at the RBI End. Also, the timing for all the bank varies as it highly depends on the customer’s timing for bank branches.

We hope that you find all the essential information about RTGS full form and RTGS from this article. If you really liked this article, then please share it with your family and friends.

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