RTGS 24x7: PROUD MOMENT for India! One of the few countries in the world to do so

In a major development, Reserve Bank of India (RBI) Governor Shaktikanta Das has confirmed that  RTGS facility is now operational 24x7. "RTGS facility becomes operational 24X7 from 12.30 am tonight. Congratulations to the teams from RBI, IFTAS and the service partners who made this possible," Das tweeted on Sunday.

With RTGS becoming operational 24x7, India has become one of the few countries in the world to operate its RTGS system round the clock throughout the year. This comes within a year of operationalising NEFT 24x7 by RBI.

The Reserve Bank had announced in the statement on Developmental and Regulatory Policies dated October 09, 2020, that the Real Time Gross Settlement System (RTGS) will be available round the clock on all days of the year. Accordingly, RTGS 24x7x365 will be launched with effect from 00:30 hours on December 14, 2020.

"Round the clock availability of RTGS will provide extended flexibility to businesses for effecting payments and will enable introduction of additional settlement cycles in ancillary payment systems. This can also be leveraged to enhance operations of Indian financial markets and cross-border payments," the central bank said in a statement.

RTGS

-The feature of positive confirmation for credit to beneficiary accounts is also available in RTGS.

-Real Time Gross Settlement can be explained as a system where there is continuous and real-time settlement of fund-transfers, individually on a transaction by transaction basis (without netting). 'Real Time' means the processing of instructions at the time they are received; 'Gross Settlement' means that the settlement of funds transfer instructions occurs individually.

Benefits of using RTGS?

-RTGS offers many advantages over the other modes of funds transfer:

-RTGS transactions / transfers have no amount cap.

-It is a safe and secure system for funds transfer.

-The system is available on all days when most bank branches are functioning, including Saturdays.

-There is real time transfer of funds to the beneficiary account.

-Remitter can initiate the remittances from his / her home / place of work using internet banking, if his / her bank offers such service.

-The transaction charges have been capped by RBI.

-The transaction has legal backing.

-The remitter need not use a physical cheque or a demand draft.

-The beneficiary need not visit a bank branch for depositing the paper instruments.

-The beneficiary need not be apprehensive about loss / theft of physical instruments or the likelihood of fraudulent encashment thereof.