Civils Daily ECONOMICS,INDIA What is RTGS ? – FAQs

What is RTGS ? – FAQs

What is RTGS ? – FAQs post thumbnail image

RTGS is a facility of Core Banking Solutions, which has benefited the Indian economy on a large scale and has also reduced the unnecessary workload on the banks. RTGS is a real time electronic fund transfer system in which funds above 2 lakhs can be transferred easily. Anyone can do this from their internet banking sitting at home, it is being explained in this way –

What is RTGS ?

‘RTGS’ stands for Real-Time Gross Settlement, which can be explained as a system in which fund transfer takes place in real time without cash transactions.

What are the benefits of using RTGS?

RTGS offers several benefits on money transfer:

  • It is a secure system for money transfer.
  • There is no amount limit in RTGS transactions/transfers.
  • The system is available on 24x7x365 basis on all days.
  • The sender or the remitter need not use any physical means or demand draft.
  • The beneficiary or receiver need not visit the bank branch to submit the document.
  • The payee or receiver of money should not be apprehensive about the possibility of loss/theft of material resources or fraudulent encashment by him.
  • The sender or the remitter can initiate the remittance from his/her home/place of work using internet banking
  • The transaction fee is decided by RBI and not by the bank which is a small fee.
  • The transaction has full legal validity.
  • Is NEFT system similar to RTGS process?
  • Basically both are electronic and real time mode of fund transfer, but there is a difference between the two.

NEFT or National Electronic Funds Transfer is an electronic fund transfer system in which transactions received up to a particular point in time are processed in batches. Conversely, in RTGS, transactions can be processed continuously on a transactional basis throughout the day. The maximum limit in NEFT is 2 lakhs while RTGS is the electronic mode of sending funds over it.

Is there any minimum / maximum amount prescribed for RTGS transactions ?

The RTGS system is primarily meant for large value transactions. The minimum amount to be remitted through RTGS is 2,00,000/- with no upper or maximum limit.

What information have to be given to the bank when you want to get RTGS done?

You must provide the following information:

  • the amount being sent means the amount to be sent
  • Number from where the amount is being sent (Account number to be debited)
  • Name of the beneficiary bank and branch
  • IFSC Number of the receiving branch
  • Receiver or receiver name of customer
  • Receiver or receiver customer’s account number
  • sender to receiver information, if any

How to find IFSC Code and IFSC Number ?

For this, you should know the name of the bank and where its branch or branch is located. After that you can find IFSC by visiting RBI website. Its link is given here (click here)

What are the precautions to be taken while RTGS transfer ?

The following should be ensured through money transfer transactions using RTGS –

  • It should be ascertained whether the sending and receiving bank is in RTGS network or not. For this IFSC code should be checked
  • Receiver or receiver customer details, name, account number and account type, beneficiary bank branch name and IFSC must be correct or else the transfer may get stuck
  • Extreme care should be taken in providing the account number of the beneficiary

If the money does not reach the account, will the customer get the money back ?

Sometimes it happens that funds may get stuck due to some misinformation, human or technical reasons, but do not be afraid because your money is always safe. When this happens, the bank reverses the fund transfer within 1 hour or till the end of the day and the money reaches the sender’s account.

What is UTR Number?

Unique Transaction Reference (UTR) number is a 22 character code used in the RTGS system to identify a specific transaction.


Disclaimer – Almost all the information has been taken by RBI and authorized sources, they can be updated, so keep updating the information from your bank and RBI. And beware of frauds like phishing at the time of fund transfer

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