Real time gross settlement (RTGS)

Real Time Gross Settlement (RTGS) is an electronic form of funds transfer where the transmission takes place on a real time basis.

Over 60 countries worldwide use RTGS systems. RTGS systems are typically run by the central bank of a country. Often, these systems are integral components of the country economy. In India, transfer of funds with RTGS is done for high value transactions, the minimum amount being Rs 2 lakh. The beneficiary account receives the funds transferred, on a real time basis. The main difference between RTGS and National Electronic Funds Transfer (NEFT) is that while transfer via NEFT takes place in batches (with settlements and transactions being netted off), in the case of RTGS, the transactions are executed individually and on gross basis.

The customer initiating the funds transfer through RTGS has to have the Indian Financial System Code (IFSC) of the beneficiary's bank, along with the name of the beneficiary, account number and name of the bank. The bank branches, both at the initiating and receiving end, have to be RTGS-enabled for the transaction to be processed. Customers with Internet banking accounts can do RTGS transactions on their own.