Electronic fund transfer means you are transferring money from your bank account to someone else bank account electronically.
Earlier we use to visit a branch for sending money, depositing cash or cheques. Now those days are gone. Today, we are talking about NEFT, RTGS and IMPS which enable us to exchange funds between friends, family members over internet. Let us understand these terms and how it can be useful for us.
NEFT – National Electronic Fund Transfer
National Electronic Fund Transfer or in short it’s called NEFT. Through NEFT you can make fund transfer easily by using your net banking account.
With a NEFT enabled bank, you are not only limited to transfer money electronically to same bank’s account but also can send it to other bank’s account.
To make the fund transfer electronically, you are required to have certain information like party’s bank account number, name of the person, IFSC code etc and then add them as a beneficiary to your account.
Also Read: How NEFT works for your
RTGS – Real Time Gross Settlement
As the name suggests, RTGS really makes your fund transfer easier than NEFT. It transfers money in real time instead of in settlements.
Under RTGS your funds are sent instantly instead of putting it on waiting list like in the case of NEFT.
Generally large amount transactions are transferred by using RTGS. The minimum amount that can be send through RTGS is Rs. 2, 00,000.
Also Read: How RTGS works for you
IMPS – Immediate Payment Service
IMPS or immediate payment service started in India by National Payments Corporation. Through IMPS one can make fund transfer by using their mobile phones.
You can also access your account balance and authorize your payments. IMPS is offered via mobile banking service or through SMS facility.
All these three methods are used in India and have its own advantages and disadvantages.
Under NEFT you do not have any restriction on minimum fund transfer but RTGS has a limit of Rs.2, 00,000.
NEFT will take little time than RTGS as under RTGS, funds are not sent in batches like in the case of NEFT.
Based on your requirements we suggest you to choose your method of electronic fund transfer. Good Luck!