Money & Banking Rails
A first-principles breakdown of central bank reserve accounts, continuous gross settlement, deferred net clearing, and the architecture that moves money between institutions.
Pieces in this series
How Money Moves Between Indian Banks
The central bank reserve ledger, RTGS continuous gross settlement, and NEFT 48-batch net clearing
Commercial banks do not send digital cash over the internet or hold accounts with each other. Every interbank transfer is an accounting entry settled across commercial bank reserve accounts held at the Reserve Bank of India's central core ledger, e-Kuber.
Why Bank Transfers Used to Take Hours (and Days)
From physical MICR clearing houses and cheque truncation to batch settlement windows and straight-through processing
Before 24x7 real-time settlement, moving money between banks required physical paper transport, scheduled clearing house sessions, manual ledger reconciliation, and strict cutoff hours to prevent systemic liquidity gridlock.