Question 68โ 2025 IAS Prelims GS I : Genius Classroom Explanation
๐ IAS Prelims 2025 โ GS-III | Q.68 | Classroom Explanation
(Economics: Banking & Payment Systems)
๐ Question
Q.68) Consider the following statements in respect of RTGS and NEFT:
Statement I: In RTGS, the settlement time is instantaneous while in case of NEFT, it takes some time to settle payments.
Statement II: In RTGS, the customer is charged for inward transactions while that is not the case for NEFT.
Statement III: Operating hours for RTGS are restricted on certain days while this is not true for NEFT.
Which of the statements given above is/are correct?
(a) I only
(b) I and II
(c) I and III
(d) III only
โ Correct Answer: (a) I only
๐งโ๐ซ Classroom Explanation
This question tests conceptual clarity between Indiaโs two core retail payment settlement systems, a high-frequency UPSC area.
๐ Core Concepts
๐น RTGS (Real Time Gross Settlement)
- Real-time
- Transaction-by-transaction
- No netting
- Used mainly for high-value transfers
๐น NEFT (National Electronic Funds Transfer)
- Batch-wise settlement
- Transactions are clubbed and settled at intervals
- Suitable for retail and small-value transfers
๐ Statement-wise Analysis
โ Statement I: Correct
- RTGS settles transactions instantly, individually, and continuously.
- NEFT settles transactions in batches, hence settlement is not instantaneous.
โก๏ธ Correct understanding of operational difference
โ๏ธ Statement I is correct.
โ Statement II: Incorrect
- As per RBI directions:
- Inward transactions are FREE for both RTGS and NEFT.
- Charges (if any) apply only to outward transactions, subject to RBI caps.
โก๏ธ Claim that RTGS charges inward transactions is factually wrong.
โ Statement II is incorrect.
โ Statement III: Incorrect
- Since 14 December 2020, RTGS operates 24ร7ร365, just like NEFT.
- NEFT has been 24ร7 since December 2019.
โก๏ธ There is no operational restriction on RTGS now.
โ Statement III is incorrect.
๐งฎ Logical Elimination (UPSC Style)
| Statement | Status |
|---|---|
| I | โ Correct |
| II | โ Incorrect |
| III | โ Incorrect |
โก๏ธ Correct option: (a) I only
๐ฏ Final Takeaway (Exam Lock)
RTGS = Real-time, high-value, 24ร7, inward free
NEFT = Batch-wise, retail, 24ร7, inward free
๐ GS Mapping
Banking, Digital Payments, Financial Infrastructure
GS Paper III
Indian Economy