The acronym RTGS stand for real time gross settlement which can be defined as as the continuous (real time) settlement of fund transfer individually on an order by order basis( without netting) 'Real Time' means the processing of instructions at the time are received rather than at some later time 'Gross Settlement' means the settlement of funds transfer instruction occurs individually( on an instruction by instruction basis) considering that the funds settlement takes place in the books of the Reserve Bank of India, the payment are final and irrevocable.
The RTGS system is primarily meant for large value transactions. the minimum amount to be remitted through RTGS is 200000. there is no upper ceiling for RTGS transactions.
under normal circumstances the beneficiary branches are expected to receive the phone in real time as soon as Funda transferred by the remitting Bank. the beneficiary bank has to credit the beneficiary account within two hours of receiving the fund transfer message.
The Remitting Bank receive a message from the Reserve Bank that money has been credited to the receiving Bank. based on this remitting bank and advise the remaining customer that money has been delivered to the receiving bank.
it is expected that the receiving bank will credit the account of the beneficiary instantly. If the money cannot be credited for any reason, the receiving Bank would have to return the money to the remitting bank within 2 hours. Once the money is received back why the remitting Bank, the original debit entry in the customer account is reversed.
