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.

Created On: Jan 27, 2015 16:12 IST

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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