RTGS – Real Time Gross Settlement.
NEFT – National Electronics Funds Transfer System.
REAL TIME GROSS SETTLEMENT
1. RTGS system is a funds transfer mechanism where transfer of money takes place from one bank to another on a ‘real time’ and on ‘gross basis’.
2. This is the fastest possible money transfer system through the banking channel.
3. Settlement in ‘real time’ means payment transaction is not subjected to any waiting period. The
transactions are settled as soon as they are processed.
4. ‘Gross settlement’ means the transaction is settled on one to one basis without bunching with any other transaction.
5. Considering that money transfer takes place in the books of the Reserve Bank of India, the payment is taken as final and irrevocable .
NATIONAL ELECTRONICS FUND TRANSFER SYSTEM
1. Funds are transferred to the credit account with the other participating Bank using RBI’s
NEFT service.
2. RBI acts as the service provider and transfers the credit to the other bank’s account.
3. NEFT operate on a deferred net settlement (DNS) basis which settles transactions in batches.
4. In DNS, the settlement takes place at a particular point of time. All transactions are held up till
that time.
Why RTGS/NEFT
1. Lower cost of transaction of RTGS/NEFT as compared to cost of transaction and remmitance
through draft
through draft
2. Draft Issue to Payment – long process, cancellation, duplicate draft issue, revalidation, IOR issues, frauds, Staff accountability
3. Customer Benefit – Immediate credit
4. Low transaction time, no printing, shorten the queues
5. Drafts will be phased out in the coming years.
RTGS/NEFT Service Availability
RTGS Transactions will be sent to RBI Based on the following Schedule:
Day Start Time End Time
Monday to Friday 9.00 hrs 16.30 hrs
Saturday 9.00 hrs 13.30 hrs
NEFT Transactions will be sent to RBI Based on the following Schedule
Day Start Time End Time
Monday to Friday 8.00 hrs 16.00 hrs
Saturday 8.00 hrs 11.30 hrs