How to do RTGS?

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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.

RTGS Charges

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.

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Tips on How to do RTGS
Benefits of RTGS Service
Requirements for an effective RTGS transaction
Tips on How to do RTGS

In order to ensure a smooth transition of funds one has to first understand how to do RTGS transfer. Here are some tips on how to do RTGS fund transfers:

  • Firstly you need to activate your internet banking facility. Contact your bank branch to do the activation
  • Log on to the online web portal of the bank with the ID and password provided to you.
  • Go to your profile and select the option of beneficiary.
  • Select RTGS from the inter-bank payment options available.
  • Select the option provided to add a beneficiary and provide the necessary details such as name, account number, address and IFSC code of the beneficiary.
  • Click the ‘accept Terms of Service (Terms & Conditions)’ button followed by ‘confirm’.
  • A high security password is sent to the mobile number as an additional security measure. Enter this password to authorize the beneficiary.
  • The beneficiary added is activated within time ranging from 30 minutes to a few hours depending upon the bank and security measures. Once the beneficiary account is activated, the transfers can be done instantly.
  • To remit funds to the Inter Bank Payee through RTGS / NEFT select the ‘Inter Bank Transfer’ link in the ‘Payments/Transfers’ tab.
  • Select the Transaction Type – RTGS or NEFT.
  • The list of beneficiary accounts added is displayed.
  • Enter the Amount and select the beneficiary to be credited from the list.
  • Click on ‘Accept Terms of Service (Terms & Conditions)’ and confirm.

In case you face any problems, it is advisable to consult your bank and get a representative to explain to you how to use RTGS funds transfer in order to ensure that there are no mistakes.

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Benefits of RTGS Service

Getting to understand how to do RTGS funds transfer is helpful in the long run as everyone prefers instant money transfers, especially for big payments. In fact the RTGS service has several benefits. Some of them are as under:

  • Saves time. Previously payments of a huge amount were made via demand draft, which could only be cleared in a period of three days. Now the same can be done within no time through RTGS
  • Saves paper. Without any need for physical documentation, transfers of huge sums can be made instantaneously.
  • There is no threat of money being stolen or cheques being forged, since all the process is done online.
  • Huge sums of money can be transferred easily, making it easier for companies to run their business smoothly.
  • Helps companies manage their business capital in a much better way.
  • There are lesser chances of counter-party default.
  • This is in turn also ensures a better supplier- buyer relationship, as a huge sum can be transferred in one go and without any delay.
Requirements for an effective RTGS transaction

Before you can initiate an effective RTGS transfer there are certain basic requirements that you need to meet. The customer will have to furnish the following information to the bank:

  • Remittance amount.
  • Account details of the remitting customer for debiting the sum.
  • Name of the beneficiary bank and branch
  • The IFSC Number of the receiving branch
  • Name of the beneficiary customer
  • Account number of the beneficiary customer
  • Sender to receiver information, if any

In case where the funds have not been transferred successfully, the remitting customer will be informed of the same and the amount will be credited back to his account.

All banks provide the customers with an option to reach out to the branch manager if they are facing any issues with the RTGS services.

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