RTGS goes 24x7 from Dec 2020: Key impacts

RBI moves RTGS to round-the-clock operations

The Reserve Bank of India (RBI) has announced that the Real Time Gross Settlement (RTGS) system will be available round the clock, 24 hours a day and seven days a week, from December 2020. The decision was outlined in the RBI’s Statement on Development and Regulatory Policies. RTGS is the country’s large-value real-time payment system used by corporates, institutions, and other users for high-value transfers. RBI said the change is aimed at providing wider payment flexibility to domestic corporates and institutions. The central bank also linked the move to ongoing efforts to integrate Indian financial markets globally and support India’s push to develop international financial centres. With this change, RBI said India will be among the very few countries globally with a 24x7x365 large value real time payment system.

What the October policy statement highlighted

In October, RBI indicated that RTGS would be made available round the clock on all days of the year. RBI framed the move as part of making payment systems more flexible for businesses. It also said round-the-clock availability would help enable additional settlement cycles in ancillary payment systems. RBI added that the change can be leveraged to enhance operations of Indian financial markets and cross-border payments. These points were reiterated in later updates as the launch approached.

Operational go-live: 12:30 am on December 14

RBI Governor Shaktikanta Das said RTGS would become operational 24x7 from 12:30 am on Monday, December 14. Updates around the operational start also specified the time as 00:30 hours Monday onwards. The shift makes the system available through all days, instead of being limited to business hours and banking working days. Das also congratulated teams from RBI and IFTAS in a public update around the go-live. The change formalised the earlier policy intent into an always-on capability for high-value payments.

How availability changes from the earlier schedule

Before 24x7 enablement, RTGS availability for customers was limited to 7:00 am to 6:00 pm on working days. It was not available on the second and fourth Saturdays of every month, aligning with banking working schedules. With 24x7 operations, these constraints are removed for RTGS users. This matters for businesses managing treasury operations, time-sensitive payments, and settlement obligations outside regular hours.

Key rules: minimum amount, no cap, final settlement

RTGS is designed for large-value instantaneous fund transfers. The minimum amount to be remitted through RTGS is Rs 2,00,000. RBI also noted that the system has no amount cap. Settlement takes place in the books of RBI, which makes payments final and irrevocable once made. These features are central to RTGS’s role in high-value transfers where certainty of settlement is critical.

Why RBI links RTGS 24x7 to broader payment settlements

Governor Das said the enablement is proposed to reduce settlement and default risk in the system. He linked this to facilitating settlement of AePS, IMPS, NETC, NFS, RuPay, and UPI transactions on all days of the week instead of five days earlier. RBI’s broader message is that an always-on large-value settlement backbone can support more frequent or broader settlement windows for other payment rails. RBI also said the extended availability can enable additional settlement cycles in ancillary payment systems.

Charges: RBI’s stance on NEFT and RTGS fees

RBI previously decided not to levy charges on transactions through NEFT and RTGS to promote digital transactions. It also asked banks to pass on the benefits to customers. Separate reporting noted that banks levied charges on their customers, indicating that fee outcomes for end users may depend on bank-level pricing decisions. The 24x7 rollout itself is an availability change, while the pricing aspect relates to RBI’s earlier direction on fees for NEFT and RTGS transactions.

What it means for businesses, markets, and cross-border workflows

RBI said round-the-clock RTGS provides extended flexibility to businesses for effecting payments. For corporates and institutions, this can support payments and settlements outside conventional cut-off windows. RBI also linked the move to enhancing the operations of Indian financial markets and cross-border payments, alongside India’s efforts to develop international financial centres. The central bank’s framing positions RTGS 24x7 as infrastructure that can support broader market functioning rather than a single-product feature.

Key facts at a glance

What to track next

RBI has emphasised that 24x7 RTGS can support additional settlement cycles in ancillary payment systems and broaden settlement coverage across the week. Users will also watch how banks operationalise customer-facing access across channels and whether bank-level charges align with RBI’s earlier direction to pass on the benefit of no RBI levies on NEFT and RTGS. For now, the confirmed change is that RTGS is available round the clock from 00:30 hours on December 14, expanding access for high-value payments across all days.