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Difference Between NEFT, RTGS And IMPS Explained

Difference Between NEFT, RTGS And IMPS

If it involves domestic currency transfers in India you can find 3 unique acronyms that are crucial to know – NEFT, IMPS, and RTGS. While most of the online money transfer services offered by Indian banks, each functions with different kinds of settlements, different timings, and transaction limits. So we’re here to make it easier to comprehend what all 3 mean and when to use each.

We will also see the difference between NEFT and RTGS, the difference between NEFT and IMPS, the difference between RTGS and IMPS and finally the difference between NEFT, RTGS and IMPS.

What is NEFT

National Electronic Funds Transfer (NEFT) is just a nation-wide centralised payment system owned and run by the Reserve Bank of India (RBI). In the event that you and your recipients have been related to various banks, then you may still deposit into their bank accounts with NEFT. The system just works but if both the banks have been NEFT-enabled, even though most banks in India are those days.

Those who don’t own banking accounts may also deposit cash using NEFT. But, such money remittances are limited to a max of ₹50,000 each transaction.

Advantages of NEFT

  • Around the clock availability on all days of the year.
  • Near-real-time funds transfer to the beneficiary account and payoff in a secure method.
  • PAN India coverage through an enormous network of divisions of all types of banks.
  • Favourable confirmation to the remitter by SMS / e-mail credit to bank accounts.
  • Penal interest supply for the delay in credit or return of trades.
  • No Limit of fees by RBI from banks.
  • No charges to savings bank account customers for internet NEFT trades.
  • Apart from the capital transfer, NEFT platform may be used to get a variety of transactions involving payment of credit card dues to the card-issuing banks, payment of loan EMI, inward foreign exchange remittances, etc..
  • Designed for one-way funds transfers from India to Nepal.

NEFT Transfer Time

The full time to transfer money through NEFT can range between 1-2 hours. It may even have a max of 24 hours at a worst-case scenario.

NEFT Transfer Limit

There’s not any limitation imposed by the RBI for the capital move through the NEFT system. But, banks can put amount limits dependent on their risk understanding with the consent of its Board.

NEFT Timings

The NEFT system is available around the clock during the year on most days, i.e., on a 24x7x365 basis via online banking. NEFT presently operates in batches on half-hourly periods throughout the day. In case of non-availability of NEFT for almost any cause, an appropriate message will be broadcasted by RBI to any or all system participants.

For offline transfer through NEFT system, the time may vary from bank to bank.

NEFT Charges

Most banks like the State Bank of India (SBI), ICICI Bank and HDFC Bank usually do not charge anything for transfers. With effect from January 01, 2020, banks have been advised never to levy any charges in their savings bank accounts holders for NEFT funds transfers initiated online.

Details Required For NEFT Transfer

  • Beneficiary’s Name
  • Beneficiary’s Branch Name
  • Beneficiary’s Bank Name
  • Beneficiary’s Account Type
  • Beneficiary’s Account No.
  • Beneficiary’s Branch IFSC

NEFT International Transfer

The outbound remittances through NEFT platform are permitted solely to Nepal under the Indo-Nepal Remittance Scheme.

What is RTGS

The acronym ‘RTGS’ represents Real Time Gross Settlement, which can be clarified as something where there’s a real-time and continuous settlement of fund-transfers. Once completed, real-time gross settlement payments are final and irrevocable.

Advantages of RTGS

  • It is secure and safe.
  • RTGS transfers have no amount cap.
  • The system is available on most days when many bank branches are functioning, for example, Saturdays.
  • There’s a real-time transfer of money into the bank accounts.
  • Cheque’s or Demand Drafts are usually not required.
  • One can transfer money from his/her home using internet banking if their bank offers such a service.

RTGS Transfer Time

In RTGS, the trades are processed continuously on a transaction by transaction basis throughout the RTGS business hours i.e real-time transactions occur.

RTGS Transfer Limit

The RTGS system is largely intended for large value transactions. The minimum amount to be remitted through RTGS is ₹2,00,000/ with no upper limit.

RTGS Timings

RTGS is not a 24×7 system. The RTGS support window for customer transactions is accessible to banks from 7 am to 6 pm on a working day, for payoff in the RBI end. On the other hand, the timings that the banks follow could vary from bank to bank.

RTGS Charges

From July 01, 2019, the Reserve Bank has waived the processing fees imposed by it for RTGS trades. Banks can pass to the advantage to their clients.

With a perspective to waive the service fees levied by banks such as supplying funds transport through RTGS program, a wide framework of fees has been mandated as below:

  • No charges for inward transactions.
  • ₹2,00,000/- to ₹5,00,000/- : Not exceeding ₹24.50/-(exclusive of tax, if any)
  • Above ₹5,00,000/- : not exceeding ₹49.50/- (exclusive of tax, if any)

Banks may opt to charge a lesser rate but can’t bill more than the prices prescribed by RBI.

Details Required For RTGS Transfer

As per RBI sources, following details are required for funds transfer through RTGS:

  • Amount to be remitted
  • The account number to be debited
  • Name of the beneficiary bank and branch
  • The IFSC Number of the receiving branch
  • Name of the beneficiary customer
  • Account number of the beneficiary customer
  • Sender to receiver information, if any

RTGS International Transfer

It is not possible to transfer funds overseas through RTGS system. It works only for transfer in India.

What is IMPS

IMPS is an acronym for Immediate Payment Method. In the IMPS system, the National Payments Corporation of India (NPCI) handles the transfer of capital between banks.

IMPS offers real-time finance transfer service on multiple channels like mobile, Internet, ATM and SMS. Though IMPS solutions are largely used on the internet, a few banks provide SMS services. Check with your bank to find out whether they encourage IMPS transfers via SMS.

Advantages of IMPS

  • Real-time fund transfer takes place
  • Available even on holidays i.e 24x7x365 availability.
  • Fast and secure.
  • The transfer can be initiated from Mobile/Internet/ATM or SMS.
  • Confirmation by SMS(Debit/Credit).

IMPS Transfer Time

The transfer is real-time i.e immediate with almost no waiting time.

IMPS Transfer Limit

The maximum amount which can be transferred through IMPS is ₹2,00,000 per transaction and ₹20,00,000 per day.

IMPS Timings

While NEFT and, as you’ll see, RTGS, are dependent on banks hours, IMPS permits for transfers 24 hours a day, 7 days a week, 365 days per year.

IMPS Charges

The fees for remittance via IMPS are determined by the respective member banks and PPIs. Please check with your bank or PPI.

Details Required For IMPS Transfer

  • MMID & Mobile no. or Account number & IFS Code or Aadhaar number
  • Amount to be transferred
  • Remarks/Payment Reference number
  • Sender’s M-PIN

IMPS International Transfer

It is not possible to transfer funds overseas through IMPS system. It works only for transfer in India.

Difference Between NEFT and RTGS

ParameterNEFTRTGS
Transfer Time1-2 hoursReal-time
Minimum Amount₹1₹2 lakh
Payment OptionsOnline/OfflineOnline/Offline
Maximum AmountNo Limit*No Limit*
Settlement TypeHalf hourly basisReal Time
Service Timings24x7x365(Online)24x7x365
Inward Transaction Charges₹0₹0
Outward Transaction Charges₹2 – ₹25 (+ GST/Tax)₹24 – ₹50(+ GST/Tax)
Note: The amount may differ from bank to bank and depending on customer segment

Difference Between NEFT and IMPS

ParameterNEFTIMPS
Transfer Time1-2 hoursReal-time
Minimum Amount₹1₹1
Payment OptionsOnline/OfflineOnline
Maximum AmountNo Limit*₹2 lakh/trans, ₹20 lakh/day
Settlement TypeHalf hourly basisReal Time
Service Timings24x7x365(Online)24x7x365
Inward Transaction Charges₹0₹0
Outward Transaction Charges₹2 – ₹25 (+ GST/Tax)Decided by banks & PPIs
Note: The amount may differ from bank to bank and depending on customer segment

Difference Between IMPS and RTGS

ParameterIMPSRTGS
Transfer TimeReal-timeReal-time
Minimum Amount₹1₹2 lakh
Payment OptionsOnlineOnline/Offline
Maximum Amount₹2 lakh/trans, ₹20 lakh/dayNo Limit*
Settlement TypeReal TimeReal Time
Service Timings24x7x36524x7x365
Inward Transaction Charges₹0₹0
Outward Transaction ChargesDecided by banks & PPIs₹24 – ₹50(+ GST/Tax)
Note: The amount may differ from bank to bank and depending on customer segment

Difference Between NEFT, RTGS & IMPS

ParameterNEFTRTGSIMPS
Transfer Time1-2 hoursReal-timeReal-time
Minimum Amount₹1₹2 lakh₹1
Payment OptionsOnline/OfflineOnline/OfflineOnline
Maximum AmountNo Limit*No Limit*₹2 lakh/trans, ₹20 lakh/day
Settlement TypeHalf hourly basisReal TimeReal Time
Service Timings24x7x365(Online)24x7x36524x7x365
Inward Transaction Charges₹0₹0₹0
Outward Transaction Charges₹2 – ₹25
(+ GST/Tax)
₹24 – ₹50
(+ GST/Tax)
Decided by banks & PPIs
Note: The amount may differ from bank to bank and depending on customer segment

Also Read: Why Health Insurance Is Important For You: Complete Guide


Disclaimer: The quotes/amount and charges provided above can differ and can change in future. Please consult your bank prior to making any move. The author and publisher don’t assume and hereby disclaim any liability to any party for any loss, damage, or disturbance brought on by errors or omissions, whether these errors or omissions result from negligence, accident, or some other reason.

Article Source: Reserve Bank Of India, National Payments Corporation of India

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