Real-time gross settlement (RTGS) is a system used by banks and financial institutions to transfer money between each other in real time. This means that transactions are processed immediately, rather than being grouped together and settled at a later time. RTGS is typically used for high-value transactions, ensuring that funds are transferred securely and efficiently. In an RTGS system, each transaction is settled individually and irrevocably, which reduces the risk of default. This system is crucial for maintaining liquidity in the financial market and is often overseen by central banks, such as the Federal Reserve in the United States or the European Central Bank in Europe.