Frequently Asked Questions
RTGS - KEPSS
- What type of System is KEPSS?
KEPSS is a Real Time Gross Settlement (RTGS) payment system.
- What does Real Time Gross Settlement (RTGS) mean?
RTGS is a settlement system in which processing and settlement take place on a transaction-by-transaction basis (without netting) in real time (continuously). Considering that money transfer takes place in the books of the Central Bank of Kenya, the payment is final and irrevocable.
- What Benefits does KEPSS have?
- It is faster means of transferring funds (instantaneously) i.e. within two hours of initiating instructions.
- It is a safe and secure mode of payment.
- It enables commercial banks to manage their liquidity efficiently.
- It is a sound mechanism for reducing settlement and systemic risks in payments process.
- It boosts investor and general public confidence in Kenya’s payment systems
- It provides the Central Bank with a better Monetary Policy Management tool thus contributing to a more stable and efficient financial sector
- How is RTGS different from Electronic Fund Transfer System (EFT)?
EFT is an electronic fund transfer modes that operate on a deferred net settlement (DNS) basis which settles transactions in batches. In DNS, the settlement takes place at a particular point of time. All transactions are held up till that time. For example, EFT settlement takes place once a day. Any transaction initiated after a designated settlement time would have to wait till the next designated settlement time. Contrary to this, in RTGS, transactions are processed continuously throughout the RTGS business hours.
- How is RTGS different from the cheque payment system?
A cheque is a debit instrument that requires the drawer to have sufficient funds at the time of presentation to the paying bank. Cheque payment operates on a deferred net settlement basis in batches. The clearing cycle for cheques in Kenya is T+ 3 that is a customer will receive value after three working days and payment is not guaranteed as is the case with RTGS payments.
- Is there any minimum / maximum amount stipulation for RTGS transactions?
The RTGS system is primarily for large value and time critical transactions. No minimum or maximum stipulation has been fixed.
- What is the time taken for effecting funds transfer from one account to another under RTGS?
Under normal circumstances the beneficiary branches are expected to receive the funds in real time as soon as funds are transferred by the remitting bank. The beneficiary bank has to credit the beneficiary’s account within two hours of receiving the funds transfer message.
- Would the remitting customer receive an acknowledgement of money credited to the beneficiary’s account?
The remitting bank receives a message from the Central Bank that money has been credited to the receiving bank. Based on this the remitting bank can advise the remitting customer that money has been delivered to the receiving bank.
- Would the remitting customer get back the money if it is not credited to the beneficiary’s account? When?
Yes. It is expected that the receiving bank will credit the account of the beneficiary instantly. If the money cannot be credited for any reason, the receiving bank would have to return the money to the remitting bank within 2hours. Once the money is received back by the remitting bank, the original debit entry in the customer’s account is reversed.
- What time is the RTGS service window available?
The RTGS service window for customer’s transactions is available from 9.00 hours to 14.00 hours on week days. However, the timings between these hours would vary depending on the commercial bank. For inter-bank transactions, the service window is available from 9.00 hours to 16.00 hours on week days.
- What are Processing Charges/Service Charges for RTGS transactions?
Levy of service charges by banks is left to the discretion of the respective banks. The bank-wise details of charges levied are available on the CBK website – www.centralbank.go.ke
- What is the essential information that the remitting customer would have to furnish to a bank for the remittance to be effected?
The remitting customer has to furnish the following information to a bank for effecting a RTGS remittance:
- Amount to be remitted
- His account number which is to be debited
- Name of the beneficiary bank
- Name of the beneficiary customer
- Account number of the beneficiary customer
- Sender to receiver information, if any
- Do all commercial banks in Kenya provide RTGS service?
Yes, all the commercial banks in Kenya are KEPSS participants.
- Can KEPSS Process Transactions in Foreign currency?
YES, but only to the extent that a Commercial bank is cleared by Kenya Bankers’ Associates (KBA) to open and operate such settlement accounts at the Central Bank of Kenya. Currently transactions are processed in three foreign currencies, namely:
The number of currencies will increase once the East Africa Cross Border Payment System is implemented.
- US dollars
- Sterling Pounds
- How secure is KEPSS?
SWIFT is the main message carrier for KEPSS which is a safe and secure financial infrastructure that is used worldwide.