What is RTGS?
19 Nov 2021

What is RTGS?

Understanding the meaning and features of RTGS funds transfer service.

Key Takeaways

  • RTGS stands for Real-Time Gross Settlement
  • With RTGS, you can transfer funds 24x7 irrespective of bank or national holidays.
  • Funds transferred through RTGS are deposited into beneficiary accounts within 30 minutes.
  • RTGS enables high-value transactions with a minimum transaction limit of INR 2 Lakhs.
  • You can conduct online and offline RTGS transactions, and there is no fixed upper limit.

The modern era has allowed us to enjoy newer, more convenient methods of conducting payments and settlements. However, with so many new methods of transferring funds, it can be confusing to pick one that meets your needs. This article focuses on one such payment method that has become incredibly popular in India – RTGS. Continue reading to know more.

What is RTGS?

RTGS full form is Real-Time Gross Settlement. This fund transfer facility was first introduced by the Reserve Bank of India (RBI) in 2004. It is a system that allows continuous real-time transfer of funds. The word ‘real-time’ highlights the nature of the transfer wherein the instructions are processed at the time they are received as opposed to after a delay or waiting period. Subsequently, the term ‘gross settlement’ means that the instructions for the transfer of funds are handled on an instruction-by-instruction basis. This transfer method is generally designed for high-value transactions, and you can use it for online and offline transactions.

Features and benefits of RTGS transactions

  • Having explained RTGS meaning, let us now analyse its features and benefits.
  • RTGS is a secure way of transferring funds.
  • There is no maximum limit on your transfer amount when you opt for RTGS through a bank branch.
  • With RTGS, you can initiate and complete real-time fund transfers into the bank accounts of your intended beneficiaries.
  • The beneficiary receives the fund credits within 30 minutes.
  • You do not need to submit any cheque or demand draft to conduct RTGS transactions.
  • Your funds are protected from loss or theft or even fraudulent encashment from beneficiaries.
  • You can initiate the transfer from anywhere with internet and mobile banking.
  • The Reserve Bank of India legally sanctions RTGS transactions.

Things to Consider While Initiating RTGS Transactions


RTGS Transactions are available on all days, at all times. It is a 24 x 7 x 365 service. You can transfer funds anytime, irrespective of bank or national holidays.

Transaction Limits

While the RBI has not placed an upper limit on RTGS transfer, the lower limit is INR 2 lakh per transaction. Also, if you choose to conduct an RTGS transfer via internet banking, you should verify the upper limits on RTGS transactions set by the bank, as it can differ from bank to bank.

Fees and Charges

The RBI has set a limit on the charges banks may levy for RTGS transfers. While there is no charge on inward transactions, you have to pay nominal fees on outward transactions as under:

Transaction Limit

RTGS Fees and Charges

INR 2 Lakh - INR 5 Lakh

Upto INR 24.5 + Taxes

INR 5 Lakh and Above

Upto INR 49.5 + Taxes

Final Note

Now that you know what is RTGS, you can leverage this fund transfer method for high-value transactions. To successfully conduct an RTGS transfer, you must ensure that both the sending and receiving banks are RTGS enabled bank branches. Also, note that RTGS transfers take place in the books of the RBI, and the payments are final and irrevocable.

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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.