NEFT (National Electronic Funds Transfer), RTGS (Real-Time Gross Settlement), and IMPS (Immediate Payment Service) are three popular electronic fund transfer mechanisms used in India. They differ in terms of transaction limits, processing times, and the types of transactions they support.
- NEFT (National Electronic Funds Transfer): NEFT is a centralized system for electronic fund transfers that operates on a deferred net settlement basis. It is typically used for transferring funds from one bank account to another bank account in India. NEFT transactions are processed in batches and settled in hourly time slots. NEFT transactions are not processed in real-time and may take several hours, or even up to a day, to be credited to the beneficiary’s account. NEFT has no minimum transaction limit, and the maximum transaction limit is set by the individual bank.
- RTGS (Real-Time Gross Settlement): RTGS is a real-time interbank electronic fund transfer system used for large value transactions. RTGS transactions are processed and settled individually and in real-time, which means that the beneficiary bank receives the funds almost instantly. RTGS is typically used for high-value transactions that require immediate settlement, such as for business or corporate transactions. RTGS transactions are generally processed during the working hours of the banks, and there is no minimum transaction limit. The minimum transaction limit for RTGS is INR 2 lakh (200,000) and there is no upper limit.
- IMPS (Immediate Payment Service): IMPS is a real-time interbank electronic fund transfer service that allows customers to transfer funds instantly 24/7, including weekends and holidays. IMPS is typically used for small value transactions and is commonly used for peer-to-peer (P2P) transfers, bill payments, and other mobile banking services. IMPS transactions are processed and settled in real-time and usually take only a few seconds to complete. IMPS has a minimum transaction limit of INR 1 and a maximum transaction limit of INR 2 lakh (200,000) for individual customers, while there may be different limits for corporate customers.
In summary, NEFT is used for deferred net settlement transfers with no minimum or maximum transaction limit, RTGS is used for real-time gross settlement of high-value transactions with a minimum transaction limit of INR 2 lakh, and IMPS is used for instant interbank transfers with a minimum transaction limit of INR 1 and a maximum transaction limit of INR 2 lakh for individual customers.