DEFINITION of 'Real Time Gross Settlement - RTGS'

The continuous settlement of payments on an individual order basis without netting debits with credits across the books of a central bank.

BREAKING DOWN 'Real Time Gross Settlement - RTGS'

Basically, this is a system for large-value interbank funds transfers. This system lessens settlement risk because interbank settlement happens throughout the day, rather than just at the end of the day.

RELATED TERMS
  1. Settlement Risk

    The risk that one party will fail to deliver the terms of a contract ...
  2. Settlement Period

    The period of time between the settlement date and the transaction ...
  3. Net Settlement

    The resolution of all of a bank's transactions at the end of ...
  4. Committee On Payment And Settlement ...

    A committee made up of the central banks of G10 countries that ...
  5. Window Settlement

    A form of settlement between dealers whereby trades are settled ...
  6. Bilateral Credit Limit

    Intraday credit limits set by two institutions for use with one ...
Related Articles
  1. Insights

    Inside National Payment Systems

    Investopedia explains: The global interconnection of U.S. payment systems makes commerical and financial transfers possible.
  2. Personal Finance

    What Is a Lawsuit Settlement Loan?

    A lawsuit settlement loan is a cash advance for an impending settlement or judgment. There can be pricey strings attached.
  3. Managing Wealth

    Profit From Unwanted Life Policies With Life Settlement

    With a life settlement you could cash in on your policy money now.
  4. Taxes

    The Truth About IRS Tax Settlement Firms

    These companies claim that they can reduce or even eliminate what you owe to the IRS. Find out the facts behind this alluring fiction.
  5. Investing

    Credit Suisse to Pay $5.3 Billion to End MBS Suit

    For the second time in as many days, a major European bank has reached a financial settlement with the U.S. Justice Department. Credit Suisse (NYSE: CS) will pay a total of nearly $5.3 billion ...
  6. Insurance

    4 Tips for Negotiating an Insurance Settlement

    It is possible to negotiate your own insurance settlement, especially when the injuries are relatively minor and the other party’s fault is obvious.
  7. Investing

    What Does Debit Mean?

    Debit is an accounting term used to refer to the left side of an accounting journal entry. Each debit must be offset by an equal credit entry.
  8. Investing

    What Do T+1, T+2, and T+3 Mean?

    T+1, T+2, and T+3 denote the day settlement occurs on a transaction.
  9. Investing

    HUD-1 Form: What Must Be On It

    You can't close on property involving federally related mortgages without a HUD-1 form. Use these instructions for a correct form so you close on time.
  10. Trading

    Understanding Forex Rollover Credits And Debits

    Forex trades are subject to receiving interest or being debited interest if positions are held overnight.
RELATED FAQS
  1. When is a share purchase marked as 'settled' by a brokerage?

    Understand the process of purchasing stock, including ordering, clearing and settlement, and learn when a stock trade is ... Read Answer >>
  2. What do T+1, T+2 and T+3 mean?

    The abbreviations T+1, T+2, and T+3 refer to the settlement dates of security transactions which occur on a transaction date ... Read Answer >>
  3. What is the difference between a Debit Order and a Standard Order in a bank reconciliation?

    Understand the main differences between debit orders and standard orders a company may utilize and the factors in doing bank ... Read Answer >>
Trading Center