The Hindu Business Line : Tap RTGS facility better, RBI urges banks

Mumbai, Jan.29 The Reserve Bank of India has directed banks to popularise the usage of the Real Time Gross Settlement (RTGS) facility as it has found that despite the facility being extended to more than 53,000 bank branches across the country, the usage of the system had not increased proportionately.

RTGS system is a funds transfer mechanism where transfer of money takes place from one bank to another on a “real time” (no waiting period and transactions are settled as soon as they are processed) and on “gross” basis (transaction is settled on one-to-one basis without bunching with any other transaction). This is the fastest possible money transfer system through the banking channel.

In order to bring RTGS usage to a desired level, the RBI has advised RTGS member banks to extend their customer windows commensurate with RBI business sessions.

According to the central bank, the new RTGS cut-off timings would be: from Monday to Friday, the customer transactions timings would be from 9.00 hours to 16.30 hours while that for inter-bank transactions would be from 9.00 hours to 18.00 hours. On Saturday, the customer transaction and inter-bank transaction timing would be 9.00 hours to 12.30 hours and 9.00 hours to 14.30 hours, respectively.

The RBI wants banks to popularise RTGS-based products by educating customers. It wants them to create a user-friendly atmosphere at branch level to increase RTGS usage and also identify such branches having the potential but not using the system.

Besides incentivising branches for extensive use of RTGS, the RBI has advised banks to make their entire branch network RTGS-enabled and also expedite providing RTGS facility to the customers of regional rural banks (RRBs) sponsored by the respective banks.

The RTGS system is primarily for large-value transactions. The minimum amount to be remitted through this system is Rs 1 lakh.

There is no upper ceiling for RTGS transactions. The beneficiary branches normally receive the funds in real time as soon as funds are transferred by the remitting bank. The beneficiary bank has to credit the beneficiary’s account within two hours of receiving the funds transfer message.

The remitting customer has to furnish information — the amount to be remitted, his/her account number which is to be debited, name and account number of the beneficiary bank, and the Indian Financial System Code of the receiving branch.

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