24×7 RTGS payments from December 14: What you need to know

The Reserve Bank of India (RBI) on Friday said that the real-time gross settlement (RTGS) payment system will be available round the clock from December 14. “It has been decided to make RTGS available round the clock on all days of the year with effect from 00:30 hours on December 14, 2020,” the central bank said in a statement.

The development comes over a month after RBI Governor Shaktikanta Das had announced that the RTGS payment system would be available on a 24×7 basis for customers from December 2020.

“With this enablement, it is proposed to reduce settlement and default risk in the system by facilitating settlement of AePS, IMPS, NETC, NFS, RuPay, UPI transactions on all days of the week. This will make the payments ecosystem more efficient,” Governor Das said in his policy review statement.

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In its statement, the RBI said RTGS shall be available for customers and inter-bank transactions round the clock, except the interval between ‘end-of-day’ and ‘start-of-day’ processes, whose timings would be duly broadcasted through the RTGS system.

The central bank said RTGS shall continue to be governed by the RTGS System Regulations, 2013, as amended from time to time. The revised regulations and details like holidays can be seen here.

Currently, the RTGS system for making payments is currently available to customers from 7 am to 6 pm on all working days except for the second and fourth Saturday of the month. But from December 14, it will be available 24×7 for all 365 days of the year.

What is RTGS System?

1) The RTGS system is primarily used for large-value transactions as it has no upper limit cap. The minimum payment needs to be Rs 2 lakh under the RTGS system. The charges on such payments had been removed by the central bank last year.

2) Under RTGS patient system, the beneficiary branches are expected to receive funds in real-time as soon as the transfer is made by the remitting bank. The beneficiary bank then credits the end beneficiary’s account within two hours of receiving the fund transfer message.

3) It may be noted that the RTGS system for payments is different from both NEFT and EFT, which are electronic fund transfer modes that operate on a deferred net settlement (DNS) basis.

4) In both NEFT and EFT, transactions are settled in batches unlike the RTGS system, where the transactions are processed in a continuous manner through the business/working hours.

5) Since the RTGS system usually involved high-value transactions, some details have to be provided by the remitting customer. The individual making the payment has to mention the account to be remitted, the amount number from which fund has to be debited, name of the beneficiary bank, name and account number of the beneficiary customer and the IFSC code of the bank receiving the funds.

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