Inter-Bank Transfers: RTGS
As we move into the technological era, all our daily transactions have moved online, including the monetary ones. Money transfer from one bank to another has become far more convenient with the advent of technologies assisting in a smooth online money transfer from one banking institution to another. Systems operating under Inter-Bank Transfer, such as, NEFT and RTGS have made lives easier for those who prefer to make monetary transactions without having to physically visit a bank and yet have secure and smooth transition in making and receiving payments. Both NEFT and RTGS are monitored by the Reserve Bank of India.
Definition of RTGS
RTGS or Real Time Gross Settlement is a system where the funds transfer requests are processed in real time, i.e. as soon as they are received from the remitting bank. Unlike in NEFT, the funds transfer instructions under RTGS are processed individually on order basis. So far, RTGS is the fastest and most secure means of funds transfer in India.
Through RTGS an individual can transfer funds from one bank to another within India on an immediate basis. It is ideally used for high value transactions only. There is a minimum cap of Rupees two lakhs on the RTGS transactions. For any value below that an individual will have to resort to NEFT. Although almost every bank offers RTGS facility to its customers, but RTGS services are not available in all the branches of every bank. There are approximately 100,000 branches across India that offer RTGS services and anyone who is interested in availing it can check whether their branch offers it, either by asking the branch or checking the list available on the official website of RBI.
All Inter-Bank Money Transfer services have a nominal charge attached to them. In order to avail the RTGS service you have to pay a certain fee in order to have your order processed. Charges for every bank vary a little but there is a uniform slab for applying the charge on payments.
The slabs are divided in two brackets:
- Transactions between 2 and 5 lakhs
- Transactions from 5 lakh onwards up to any amount
The RTGS charges follow the same slab with some further demarcations.
- The bracket of 2 to 5 lakhs carries a nominal charge of Rs. 25/- as existing charges for branch and Rs.5/- for transactions through internet banking channels
- The bracket of 5 lakh and above carries a charge of Rs.50 as existing charges for branch and Rs.10/- for transactions through internet.
Please note that these charges are exclusive of GST.