Understanding the features and meaning of RTGS

Real-Time Gross Settlement (RTGS) allows you to transfer large sums of money instantly and easily in a secure manner. Whether you are a business owner, a real estate investor or simply managing high-value transfers, understanding RTGS can transform the way you handle financial transactions.

Meaning of RTGS

RTGS stands for Real-Time Gross Settlement. It is an electronic form of fund transfer where the transmission happens on a real-time basis, and settlement occurs individually, not in batches. The meaning of RTGS is straightforward: it allows you to transfer money from one bank to another instantly, with the Central Bank i.e. the Reserve Bank of India ensuring the settlement is final and irrevocable.

Features and benefits of RTGS

High security

RTGS transactions are highly secure. The system is regulated by the Reserve Bank of India (RBI), which ensures stringent monitoring and compliance, safeguarding against fraud and misuse.

Real-time transfer

The primary benefit of RTGS is the real-time transfer of funds. Unlike other methods that may take hours or days, RTGS ensures the beneficiary receives the money almost instantly.

No maximum limit

One of the most appealing aspects of RTGS is that there is no maximum limit on the amount that can be transferred. This makes it ideal for high-value transactions.

Reduced risk

Since the funds are transferred in real-time and settled individually, the risk of default or delay is significantly minimised, thus enhancing trust between parties.

Convenience of Internet banking

RTGS can be accessed through Internet banking, making it convenient for individuals and businesses to transfer funds without visiting a bank branch. This adds to the ease and speed of transactions.

No fees or charges

Most of the major banks including Axis Bank, offer RTGS services with no fees or charges, making it a cost-effective option for transferring large sums of money.

Legal backing

RTGS transactions have a strong legal backing. Once a transaction is completed, it is final and irrevocable, providing certainty and security to both the sender and the recipient.

How to do RTGS fund transfers?

Axis Bank offers multiple convenient methods to execute RTGS transfers -

Through branch / offline mode

1. Go to the nearest Axis Bank branch

2. Request an RTGS form from the bank representative and fill out the necessary details, including beneficiary account information and amount

3. Submit the completed form, along with any required identification documents

4. The bank official will process your RTGS request and allot a transaction confirmation slip for your records

Through online banking

1. Access Axis Bank's online banking portal and log in with your user ID and password.

2. Go to the 'Payments' or 'Funds Transfer' section and select 'RTGS' as your transfer method

3. Enter the beneficiary's details, such as the account number, IFSC, and the amount to be transferred

4. Review the details and confirm the transaction using an OTP (One-Time Password) sent to your registered mobile number

5. You will receive an email and SMS confirmation once the transaction is successfully completed

RTGS charges

There is no charge for RTGS if you do it via your Axis Bank Internet Account. If you do it at an Axis Bank branch, there are no charges for a specified number of transactions per month. But charges may apply beyond this limit based on the type of account you hold.

For detailed information about the specific charges and limits applicable to different account types, please refer to the Axis Bank Fees and Charges Master.

Here's a summary of the RTGS charges:

• Personal Savings Accounts: Generally, a certain number of RTGS transactions per month are free. Beyond this limit, nominal charges may apply.
• Business Accounts: Business and corporate accounts may have different limits and charges for RTGS transactions based on the account type and the volume of transactions.

Limitations of RTGS

1. Minimum amount: RTGS requires a minimum transaction of ₹2 lakh, making it unsuitable for smaller amounts.

2. Banking hours: While transfers can be initiated 24x7 through internet banking, the transactions will be processed only during bank working hours, typically between 7 AM and 6 PM on weekdays, and shorter hours on Saturdays. So, if you initiate the transaction after 6 pm, it will go be processed the next day. For further details please refer click here.

3. Irreversible transactions: Once initiated, RTGS transactions cannot be reversed or cancelled, requiring careful verification of details.

4. Bank accounts only: RTGS is limited to transfers between bank accounts in India and cannot be used for cash or international transfers.

5. System dependence: The speed and success of transfers depend on both the sender and recipient bank systems, which may face occasional technical issues.

6. Delayed updates: Any processing delays may not be communicated in real-time, causing temporary uncertainty.

Also Read: How long do wire transfers take?

Conclusion

RTGS is a reliable, fast and secure way to transfer large sums of money. Understanding RTGS transfer meaning and its numerous benefits can significantly enhance your financial management. With Axis Bank's RTGS services, you can ensure your high-value transactions are swift, secure and cost-effective.

FAQs

What happens if the amount sent through RTGS does not reach the beneficiary?

If the amount does not reach the beneficiary, it is usually returned to the sender's account within an hour. Contact your bank immediately to resolve any issues.

Is there any minimum amount for RTGS transactions?

Yes, the minimum amount for RTGS transactions is ₹2 lakh.

When should I use RTGS to transfer money?

RTGS should be used for high-value transactions that need to be settled immediately and securely. It is ideal for business payments, real estate transactions, and other significant transfers.

How long does it take for an RTGS transaction to be processed?

RTGS transactions are processed in real-time, meaning the funds are transferred to the beneficiary's account within a few minutes, subject to banking hours.

Can RTGS transactions be reversed or cancelled once initiated?

No, RTGS transactions cannot be reversed or cancelled once initiated. It is crucial to double-check all details before confirming the transaction.

Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.