REAL TIME GROSS SETTLEMENT

byPRATHEEBAN R

MBA – Banking TechnologySchool of ManagementPondicherry University

AGENDAE-Transfer Systems in INDIARTGSWhy RTGS ?What If, NO RTGS ?Making RTGS Payments

TimingsTransaction AmountProcessing Charges

RTGS : Visual OverviewRTGS Customer SupportSimilar RTGS in Other CountriesReference

E-Transfer Systems in INDIA

NEFTNational Electronic Funds Transfer

RTGSReal Time Gross Settlement

IMPSImmediate Payment Service

RTGScontinuous (real-time) settlement of funds transfers

individually on an order by order basis 

Real Time - processing of instructions at the time they are receivedpayment transaction is not subjected to any waiting period

Gross Settlement - settlement of instructions occurs individuallytransaction is settled on one to one basis without bunching or

netting with any other transaction

payments are final and irrevocable

Why RTGS ?lower cost of transaction as compared to cost of

transaction and remittance through draft

reduces the cost of exchanging goods and services

indispensable to the functioning of the interbank, money, and capital markets

technical efficiency of the payment system is important for development of an economy.

What If, No RTGS ?severely drag on the stability & developmental

capacity of a national economy

inefficient use of financial resources

inequitable risk-sharing among agents

actual losses for participants

loss of confidence in the financial system

MakingRTGSPayments

Information needed for Effective Remittance

Amount to be remittedRemitting customer’s account number which

is to be debited.Name of the beneficiary bank.Name of the beneficiary.Account number of the beneficiary.IFSC code of the destination bank branch

Timings

No Service on Bank scheduled Holidays

Transaction AmountMinimum : INR 200,000 (for INDIA)

Maximum : No Limit

maximum amount may vary with respect to banks

For example, RTGS maximum Amount Limit in SBI Rs.5 million for small & medium enterprise Rs.5 billion for large & very large corporate

Processing ChargesTimings Amount (Rs.) Charges (Rs.)

9 a.m. – 12 noon200,000 – 500,000 25

Above 500,000 50

After 12 noon – 3:30 p.m.

200,000 – 500,000 26

Above 500,000 51

After 3:30 p.m.200,000 – 500,000 30

Above 500,000 55

RTGS : Visual OverView

using FINACLE, a banking software developed by INFOSYS

Transaction Flow : RTGS

// No special characters like *, /, @ to be used in any of the fields

Transaction Flow : RTGS (contd…) OUTGOING MESSAGE (Cheque)

Dimmed fields Cheque No

Chq Date

Transaction Flow : RTGS (contd...) OUTGOING MESSAGE (Cash)

Remittance Amount excl Comm.

Commission Amt.

STATUS ENQUIRY OF RTGS MESSAGES for Inward and Outward

STATUS ENQUIRY OF RTGS MESSAGE for Inward and Outward.(contd…)

RTGS Customer Supportcontact Branch/Bank

(OR)contact Customer Service Department of RBI 

The Chief General ManagerReserve Bank of IndiaCustomer Service Department1st Floor, Amar Building, FortMumbai – 400 001

(OR)

Mail to : cgmcsd@rbi.org.in

Similar RTGS in Other Countries Britain

Clearing House Automated Payment System (CHAPS) Canada

Large Value Transfer System (LVTS) Australia

Reserve Bank Information and Transfer System (RITS) United States

Federal Reserve Wire Network (Fedwire) European Union

Trans-European Automated Real-time Gross Settlement Express Transfer System 2 (TARGET2)

Singapore MAS Electronic Payment System Plus (MEPS+)

Switzerland Swiss Interbank Clearing (SIC)

Saudi Arabia Saudi Arabian Riyal Interbank Express (SARIE)

ReferenceReserve Bank of IndiaState Bank of IndiaIndustrial Credit and Investment Corporation

of Indiahttp://en.wikipedia.org/wiki/

Indian_settlement_systems http://en.wikipedia.org/wiki/

Real_Time_Gross_SettlementCasansaar.comJagoInvestor.com

Any Questions ?

THANK YOU!