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What is RTGS System? How is it different from National Electronic Funds Transfer System (NEFT)?

Important banking qna for banking aspirants, which is helpful in banking exam.

Jan 27, 2015 16:12 IST
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Question

What is RTGS System? How is it different from National Electronic Funds Transfer System (NEFT)?

  • RTGS' stands for Real Time Gross Settlement
  • RTGS transactions are processed continuously throughout the RTGS business hours.
  • It is continuous (real-time) settlement of funds transfers individually on an order by order basis
  • The funds settlement takes place in the books of the Reserve Bank of India, the payments are final and irrevocable.
  • The transactions are netted (payable and receivables) in NEFT whereas in RTGS the transactions are settled individually.
  • RTGS transactions are processed continuously throughout the RTGS business hours.
  • But, NEFT operates in hourly batches.

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