The Real Time Gross Settlement or the RTGS as is popularly called, would begin its 24x7 service from December 14, 2020. This is good for persons and entities wanting to remit larger amounts, throughout the day and night including bank holidays.
The average size for RTGS transactions in November 2020 was Rs 57.96 lakh making it a truly large value payment system.
RTGS uses ISO 20022 format which is the best-in-class messaging standard for financial transactions. The feature of positive confirmation for credit to beneficiary accounts is also available in RTGS.
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.
Some important details pertaining to the RTGS:
1) Time taken for remittance
Since the transactions are based on real time, the beneficiary bank receives the money in real time. The RBI has stipulated a time limit of 30 minutes to credit the account of the beneficiary.
2) Only bank account number is important
The transaction happens in real time and hence it is not possible to match the names. Often, in India the name is written in various ways and sometimes only with initials. Hence, what's most important is the account number that has to be credited.
3) Can a remitting person track the transaction
While customers do not have the facility to track the transaction, the RBI has implemented the feature of positive confirmation in an RTGS transaction. Under this, the remitting bank would receive a message from RBI (through the beneficiary bank) that the money has been credited to the beneficiary bank / customer account. Based on this, the remitting bank should advise the remitting customer that money has been credited to the receiving bank's beneficiary account.
4) What happens if the money is not credited to the beneficiary bank?
If it is not possible to credit the funds to the beneficiary customer's account for any reason, the funds received by the RTGS member bank will be returned to the originating bank within one hour of receipt of the payment at the Payment Interface (PI) or before the end of the RTGS Business day, whichever is earlier. Once the money is received back by the remitting bank, the original debit entry in the customer's account needs to be reversed.
5) Whom can a customer contact, in case of non-credit or delay in credit to the beneficiary account?
The customer can contact his / her bank / branch if there is an issue of delay / non-credit to the beneficiary account. If the issue is not resolved satisfactorily, complaint may be lodged at email or by post at following address giving UTR number and details of the issue -
The Chief General Manager
Customer Education and Protection Department
1st Floor, Amar Building, Fort
Reserve Bank of India
SBS Road, Fort
Mumbai, 400 001
For larger remittances one has to use the RTGS, which is very reliable. It's nice that the remittance system will now be operational 24x7 from Dec 14 onwards.