• How one to one payments transactions are happening

    I would like to know what really happens when we transfer money from our account to someone elses account,

    What would be the transctin flow in this case and who are the participant in this .

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  • This basically depends on where the receiver's account is.

    It could be in Same Bank in same country

    Different Bank Same country

    Different Bank Different Country

    If its Same Bank in same country then its mere book transfer.

    If you know about accounting then Bank maintains books for both these accounts, banks debits one and credits another


    Different Bank Same country: Here the clearing houses comes in picture depending on what method you have used to transfer money (ACH, Low Value, RTGS etc.)

    Banks maintain account with CSM, Bank debits your account credits the the Bank maintains with CSM then a message goes to CSM, CSM based on the message will debit the sender's bank account and credits the receiver's bank account, then receiver bank will debit its account with CSM and credits the beneficiary


    Different Bank Different Country: Here since there is no CSM there for correspondent banking comes in picture, basically the roles CSM plays domestically as part of settlement in a way the correspondent does that in a differnt country.


    Hope this would help.

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