{"id":4458,"date":"2023-04-06T19:19:03","date_gmt":"2023-04-06T13:49:03","guid":{"rendered":"https:\/\/fatakpay.com\/blog\/?p=4458"},"modified":"2026-01-27T10:11:50","modified_gmt":"2026-01-27T04:41:50","slug":"what-is-rtgs","status":"publish","type":"post","link":"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/","title":{"rendered":"What is RTGS?"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_83 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#Introduction_to_RTGS\" >Introduction to RTGS:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#How_does_RTGS_work\" >How does RTGS work?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#Real-Time_Gross_Settlement_vs_Bankers_Automated_Clearing_Services_BACS\" >Real-Time Gross Settlement vs Bankers&#8217; Automated Clearing Services (BACS):<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#Prerequisites_of_Real-Time_Gross_Settlement\" >Prerequisites of Real-Time Gross Settlement<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#Failures_of_the_Real-Time_Gross_Settlement_Transaction\" >Failures of the Real-Time Gross Settlement Transaction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#Limitations_of_RTGS\" >Limitations of RTGS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#About_FatakPay\" >About FatakPay:&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-is-rtgs\/#Learn_More_About_Payment_Systems\" >Learn More About Payment Systems:<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Introduction_to_RTGS\"><\/span>Introduction to RTGS:<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The term &#8220;real-time gross settlement,&#8221; or <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-black-color\">RTGS<\/mark>, refers to a method of moving money and\/or securities in real-time. A central bank can continue sending payments via the RTGS protocol without totaling all of its debits and credits. Once made, real-time gross settlement payments cannot be cancelled or reversed. The central banks of the vast majority of nations oversee the systems.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_does_RTGS_work\"><\/span>How does RTGS work?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Real-time refers to the process of <strong>settling transactions<\/strong> as soon as they are received. As soon as money is sent from the sending bank to the receiving bank, the transaction is thus complete. <strong>Gross settlement<\/strong> denotes the separate handling and settlement of each transaction rather than its bundling or pooling. This is the construction of a real-time gross settlement system.<\/p>\n\n\n\n<p>Large cash transfers between banks that are managed and coordinated by the central bank typically employ an <strong>RTGS<\/strong> system. These transfers frequently require immediate and thorough clearance.<\/p>\n\n\n\n<p>The Fedwire system became live in 1970. The first real-time system that resembled a gross settlement mechanism was this one. It enhanced the telegraph-based system for electronically transferring funds between US Federal Reserve institutions.<\/p>\n\n\n\n<p>The Bank of England presently oversees the Clearing House Automatic Payment System (<mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-black-color\">CHAPS<\/mark>) in the UK. Several industrialised and developing nations have also employed comparable approaches.<\/p>\n\n\n\n<p>Due to the fact that interbank settlement typically takes place throughout the day rather than just at the end of the day, real-time gross settlement reduces settlement risk, also known as &#8220;delivery risk.&#8221; This prevents a delay in the transaction. <strong>RTGS<\/strong> typically costs more to process than net and group payments do.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Real-Time_Gross_Settlement_vs_Bankers_Automated_Clearing_Services_BACS\"><\/span>Real-Time Gross Settlement vs Bankers&#8217; Automated Clearing Services (BACS):<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Real-time <strong>gross settlement systems<\/strong> are different from net settlement systems, such as those used by Bacs Payment Schemes Limited (formerly known as the Bankers&#8217; Automated Clearing Services) in the United Kingdom (BACS). Throughout the day, institutions transfer funds between themselves. Institutional accounts are updated at the end of each business day using the net amounts of money that were exchanged.<\/p>\n\n\n\n<p>The technology eliminates the requirement for in-person cash exchange. The central bank updates the accounts of banks that send and receive money electronically. Bank A will lose Rs.10 lakh while Bank B will gain Rs.10 lakh<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Prerequisites_of_Real-Time_Gross_Settlement\"><\/span>Prerequisites of Real-Time Gross Settlement<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><\/td><td>RTGS Online<\/td><td>RTGS Offline<\/td><\/tr><tr><td>How to Make RTGS Transfers?<br>As was already indicated, there are two ways to transfer money using RTGS: online and offline. You&#8217;ll need to take the actions outlined below, depending on the model you choose:<\/td><td>a) Online RTGS&nbsp;<br>You must register for the services online and through the <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\">net banking<\/mark> portal in order to instantly transfer money. Following completion of this step, you must provide the beneficiary&#8217;s RTGS information, the transfer amount, and payment authentication.<\/td><td>b) Offline RTGS<br>Real-time gross settlement system offline allows you to transfer money between accounts even if you don&#8217;t have access to RTGS net banking or mobile banking. All you would need to do is go to the nearby bank branch, complete the RTGS form, and make the payment in cash or by check.<\/td><\/tr><tr><td>Charges of RTGS Transactions<br>Here are the charges for both forms of RTGS transactions:<\/td><td>a) For Online RTGS Transfer<br>For RTGS transactions that are started online, the RBI has eliminated the services fees associated with the transfer of funds.<br><br><\/td><td>b) For Offline RTGS Transfers<br>The fees associated with RTGS transactions that are started at the bank may vary from one bank to another. The maximum sum that a bank may charge based on the transaction is still capped at a certain level. A single RTGS payment would not be subject to a bank fee of more than Rs. 55.&nbsp;<br>The service fee for an outgoing transaction of up to Rs. 5 lakhs should not be more than Rs. 30, according to the RBI. For transactions worth more than Rs. 5 lakhs, it shouldn&#8217;t be more than Rs. 55. To find out the precise fees of the transfer, you could also contact your bank before you make the transaction.&nbsp;<br><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Failures_of_the_Real-Time_Gross_Settlement_Transaction\"><\/span>Failures of the Real-Time Gross Settlement Transaction<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>I also has a chance to fail. The most frequent causes of <strong>RTGS transaction<\/strong> failure are non-existent accounts or insufficient funds. If an amount is debited, it will be credited back to the account of the payment or account holder.<\/p>\n\n\n\n<p>As soon as the bank on the other end transfers the specified sum, this will take place. Normally, the sum is determined within an hour after the failure or, at the most, by the end of the business day.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Limitations_of_RTGS\"><\/span>Limitations of RTGS<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Only high-value transactions were considered while building the <strong>RTGS transfers<\/strong>. You will only need to send money if the amount exceeds the predetermined threshold, which is greater than 2 lakh rupees.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"About_FatakPay\"><\/span>About FatakPay:&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p><a href=\"https:\/\/fatakpay.com\/\" target=\"_blank\" rel=\"noopener\"><strong>FatakPay<\/strong><\/a> provides virtual <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-black-color\">small credit<\/mark> facilities for all. It&#8217;s available on your phone and caters to your everyday needs in both online and offline formats. Payments are done seamlessly through UPI\/QR codes. The solution provides an almost zero cost, free, quick, transparent and secure way to transact in a multilingual format with a Scan Now, Pay Later facility and easy repayment options.<\/p>\n\n\n\n<p>Link to FatakPay App: <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\"><a href=\"https:\/\/link.ftkp.in\/2uSI\/dkasgvnf\" target=\"_blank\" rel=\"noopener\">https:\/\/link.ftkp.in\/2uSI\/dkasgvnf<\/a><\/mark><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Learn_More_About_Payment_Systems\"><\/span><strong>Learn More About Payment Systems:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>To gain a deeper understanding of digital payment methods, explore our related blogs:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong><a href=\"https:\/\/fatakpay.com\/blog\/what-is-upi\/\" target=\"_blank\" rel=\"noopener\">What is UPI?<\/a><\/strong> \u2013 Discover how UPI is revolutionizing instant payments in India.<\/li>\n\n\n\n<li><strong><a href=\"https:\/\/fatakpay.com\/blog\/what-is-neft\/\" target=\"_blank\" rel=\"noopener\">What is NEFT?<\/a><\/strong> \u2013 Learn about the National Electronic Funds Transfer system for secure money transfers<\/li>\n\n\n\n<li><strong><a href=\"https:\/\/fatakpay.com\/blog\/what-is-imps\/\" target=\"_blank\" rel=\"noopener\">What is IMPS?<\/a><\/strong> \u2013 Understand how IMPS enables immediate payments and transfers, even outside of banking hours.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n<\/p>\n\n\n<script type=\"application\/ld+json\">\n{\n  \"@context\": \"https:\/\/schema.org\",\n  \"@type\": \"BlogPosting\",\n  \"headline\": \"What is RTGS?\",\n  \"description\": \"Understand Real-Time Gross Settlement (RTGS) \u2014 its process, limits, and benefits for instant high-value bank transfers in India.\",\n  \"image\": \"https:\/\/fatakpay.com\/blog\/wp-content\/uploads\/2023\/04\/what-is-RTGS-1.jpg\",\n  \"datePublished\": \"2023-04-06\",\n  \"dateModified\": \"2023-04-06\",\n  \"mainEntityOfPage\": {\n    \"@type\": \"WebPage\",\n    \"@id\": \"https:\/\/fatakpay.com\/blog\/what-is-rtgs\/\"\n  },\n  \"author\": {\n    \"@type\": \"Organization\",\n    \"name\": \"FatakPay Digital Pvt. 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The central banks of<\/p>\n","protected":false},"author":1,"featured_media":6799,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[260],"tags":[97,98,95,96,103],"class_list":{"0":"post-4458","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-learn-finance","8":"tag-fatakpay","9":"tag-finance-tips","10":"tag-financial-wellness","11":"tag-fintech","12":"tag-investments"},"_links":{"self":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts\/4458","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/comments?post=4458"}],"version-history":[{"count":17,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts\/4458\/revisions"}],"predecessor-version":[{"id":7994,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts\/4458\/revisions\/7994"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/media\/6799"}],"wp:attachment":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/media?parent=4458"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/categories?post=4458"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/tags?post=4458"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}