Real-time gross settlement (RTGS) payments are becoming more and more popular, as businesses and consumers alike seek the security and convenience of instantaneous transactions. But what are RTGS payments, exactly? In this article, we will answer some of the most frequently asked questions about RTGS payments.

RTGS payments: Definition

An RTGS payment is an electronic payment processed and settled in real-time. That means that once a payment is made, the funds are immediately available to the recipient. RTGS payments are typically used for high-value transactions, such as property purchases or large business payments.

On that note, here are seven frequently asked questions about RTGS payments:

1. What information do I need to make an RTGS payment?

To make an RTGS payment, you will need to provide the following information:

• The name of the recipient bank
• The account number of the recipient
• The amount you wish to pay
• The reason for the payment (also known as a ‘payment reference’)

2. How do I make an RTGS payment?

Making an RTGS payment is easy. Simply log into your online banking platform or mobile app and enter the required information. Once this information is entered, the funds will be transferred immediately. You will usually receive a confirmation message or email once the transaction is complete.

3. How long do RTGS payments take?

RTGS payments are processed in real-time, so they are instantaneous. Once you have made a payment, the funds will be available to the recipient immediately. It’s important to note that RTGS payments can only be made during business hours. If you make a payment outside of business hours, it will be processed the next business day.

If in case you need to make an urgent payment, you can also create an RTGS payment over the phone by calling your bank’s customer service number.

4. Are RTGS payments safe?

Yes, RTGS payments are very safe. All RTGS payments are processed through the SWIFT network, which is one of the most secure banking networks in the world. Furthermore, all transactions are backed by the Central Bank guarantee.

RTGS payments offer more transparency than traditional bank transfers. With online banking, you can easily track your payments and see when they have been processed.

5. What is the difference between an RTGS payment and a wire transfer?

The main difference between an RTGS payment and a wire transfer is that an RTGS payment is processed in real-time while a wire transfer may take several days to process. Wire transfers are typically used for smaller transactions, while RTGS payments are typically used for high-value transactions.

Another difference between RTGS payments and wire transfers is that you will usually need to provide more information for a wire transfer than an RTGS payment. For example, you will need to provide the recipient’s bank name, account number and routing number for a wire transfer.

6. What are the limitations of RTGS payments?

RTGS payments are not without their limitations. For example, and as mentioned earlier, RTGS payments can only be made during business hours. Furthermore, RTGS payments can only be made in Australian dollars. If you need to make a payment in another currency, you will need to use a different method, such as a wire transfer.

7. Can I make an RTGS payment to any bank? 

No, you can only make RTGS payments to banks members of the SWIFT network. To find out if a particular bank is a member of SWIFT, you can contact the bank directly or visit the SWIFT website.

If you need to make a payment to a bank that is not a member of SWIFT, you will need to use an alternative method, such as a wire transfer. Wire transfers typically take longer to process than RTGS payments.