Differences Between NEFT, IMPS And RTGS – In-depth Analysis.
This a detailed article about key differences about all top 3 modes of payment transfer in india. The article is created after an in-depth research on the internet, analysis of content on RBI and Other financial websites.
National Electronic Funds Transfer (NEFT)
This type of fund transfer happens based on the available transfer slots as per RBI. In case if the transfer is initiated after the day’s last settlement slot, then the fund transfer happens on the next business day.
How Much Money Can Be Transferred Using NEFT?
There is, no minimum or maximum limit. The cash-based remittance has a limit of Rs 50,000 per transaction. This Rs 50,000 per transaction limit is also applicable to payments made from India to Nepal by using NEFT.
All settlements are done in batches quite similar to Ach and echeck payments in the USA. Just to give you a brief idea about ACH it is a well known method of payment processing in USA. This method is highly popular with entrepreneurs that require high risk merchant accounts. The financial institution collects multiple transaction requests and sends it to the clearance system in batches.
As the mode of payment transfer utilizes the batch model, the payments may take two business hours to reflect into the receiver’s account provided the transaction was initiated within the available transfer slots.
On weekdays there are twelve slots, and the timeframe is between 8:00 AM to 7:00 PM.
On Saturdays, there are only six batches and the time frame is between 8:00 AM to 1:00 PM only. This service is not available on Sundays and bank holidays.
NEFT Transactions can be initiated using Banks Website, Mobile Payment Application provided by financial institutions and also at the Banks branch.
The sender account is billed for the charges and the receiver account does not pay any charges. GST applies to all transactions.
Charges for NEFT in case of
Transaction value up to Rs. 10,000 is Rs. 2.50
Transaction value from Rs. 10,000 to Rs. 100,000 is Rs 5
Transaction value from Rs. 100,000 to Rs 200,000 is Rs 15
Transaction above from Rs. 200,000 is Rs 25
Real Time Gross Settlement (RTGS)
NEFT the transactions take place in batches. In the case of RTGS, the operations take place throughout the working time frame of the system. Working time frame of the RTGS system is 9:00 AM to 4:30 PM on weekdays. Working time frame of the RTGS system on Saturdays is between 9:00 AM to 2:00 PM.
RTGS transactions can be initiated by using the Banks website, Mobile Application provided by the financial institution and the Banks branch.
Most of the times the receivers account receives the funds within 30 minutes. This service is not available on Bank Holidays.
RTGS Transfers have a lower and upper limit. It is not for transactions below Rs. 200,000. As per RBI, there is no upper ceiling for RTGS transactions, but most banks limit it to Rs. 1000,000.
What is RTGS upper limit
As per the RBI Website, there is no upper limit for RTGS Transactions in India. Although banks may implement limits for risk mitigation.
RTGS Transaction Charges
For transactions within the range of Rs. 200,000 to Rs. 500,000 the charges are Rs. 30
For transactions over Rs. 500,000 the transaction charge is Rs.55
Immediate Payment Service (IMPS)
This is one of the most popular modes of fund transfer in India. It is popular because it is fast and is available round the clock. IMPS fund transfer can be initiated using banks website and banks mobile APP. The Maximum amount that can be transferred by using IMPS is Rs. 200,000.
The charges for transactions of Rs. 10,000 or less is Rs.2.50
Rs.5 is charged for Transactions of Rs 10,000 to Rs. 100,000. For any transactions between Rs. 100,000 and Rs. 200,000 a charge of Rs.15 is applicable.
Disclaimer:– Although we have taken care to ensure that the above-listed content is free from error but still we can not guaranty the accuracy. This content should never be considered 100% accurate. For detailed and accurate information visit the RBI website or your financial institution’s website.