Real-Time Gross Settlement (RTGS) networks require high levels of reserve liquidity to function smoothly throughout the operating day. Intraday liquidity represents the funds banks hold to execute payments during business hours, ensuring transaction flows match incoming and outgoing transfers. [1, 2]

If a commercial bank faces an imbalance between its incoming and outgoing payments—such as sending large corporate wires in the morning but not receiving matching inflows until late afternoon—it must fund that temporary liquidity gap using its own reserve cushions or external credit lines to prevent processing delays:

[Morning Payment Demand Spikes] ---> [Reserve Balance Depleted] ---> [Transaction Queues Form] ---> [Settlement Latency Increases]