NEFT - National Electronic Funds Transfer

National Electronic Funds Transfer, NEFT, is a system, maintained by Reserve Bank of India (RBI), that enables the customers to transfer funds from one bank branch to another, anywhere across the country. Fund transfers are settled in batches. Indian Financial System Code (IFSC code) is required to make an online transfer using NEFT.

To make NEFT transactions, following are necessary:

In today’s time of a busy schedule, NEFT process is very easy and secure. There are close to none chances of any error occurring at any stage if the entered information is correct. The receiver doesn’t need to go anywhere to collect or deposit any physical cheque or Demand Draft from the sender. As instant is the process of sending the money, as is the process of receiving money. The receiver, if has his/her phone number or email registered with their bank account, will receive an SMS or email confirmation. These transactions are irrevocable and final by nature, which means funds transferred cannot be remitted back. Online transfers eliminate the delays in fund movements to a large extent, as the transactions settle within a span of 24 hours from the initiation of the process. The process is not just hassle-free and secure but also eco-friendly as it involves no use of paper in transferring funds. Thus, this can be called a simple, secure, safe, cost-effective and fastest way to transfer money online.

NEFT timings:

National Electronic Funds Transfer timings are in hourly batches.There are twelve settlements from 8 am to 7 pm on weekdays (Monday to Friday) and six settlements from 8 am to 1 pm on Saturdays.

Who can transfer & receive electronic funds using NEFT?

Individuals having an account with a bank branch can transfer & receive funds using National Electronic Funds Transfer. Walk-in customers can also deposit cash at the NEFT-enabled branches but cash remittances will be restricted to a maximum of Rs.50, 000/- per transaction. This scheme also aids transfer of funds from India to Nepal in which a payer can transfer electronic funds from NEFT-enabled bank branches to Nepal, irrespective of whether the beneficiary maintains a bank account or not.

Is NEFT chargeable?

The beneficiaries are not charged for NEFT transactions. However, the senders get charged a minimum percentage of the amount that is being credited:

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What is IFSC code?

IFSC is an acronym for Indian Financial System Code. It is a 11 characters alphanumeric code which is unique for every bank's branch. The last 6 characters of an IFSC code represents a specific branch of a bank.

Why we need IFSC code?

For online funds transfers via National Electronic Fund Transfer (NEFT), Real Time Gross Settlement (RTGS) and Immediate Payment System (IMPS), we need IFSC code of the beneficiary account.

What is NEFT?

NEFT is an acronym for National Electronic Funds Transfer. It is the most commonly used method for online funds transfer. The transfer doesn’t happen in real-time, rather in slots. There are 11 slots from 8 am to 7 pm on weekdays (Monday through Friday) and 6 slots from 8 am to 1 pm on Saturdays (except 2nd and 4th Saturday).

NEFT Charges

  • - Transactions up to ₹ 10,000 – not exceeding ₹ 2.50 + service tax
  • - Transactions above ₹ 10,000 and up to ₹ 1 lakh – not exceeding ₹ 5 + service tax
  • - Transactions above ₹ 1 lakh and up to ₹ 2 lakhs – not exceeding ₹ 15 + service tax
  • - Transactions above ₹ 2 lakhs – not exceeding ₹ 25 + service tax

Note: There is no minimum or maximum transfer limit.

What is RTGS?

RTGS is an acronym for Real Time Gross Settlement. Real Time means that the settlement of fund happens in real-time, individually on an instruction by instruction basis, without any delay. RTGS transfer has a minimum limit of rupees 2 lakhs (200,000). As per Reserve Bank of India, there is no maximum limit defined on an RTGS transfer, though the banks might put their own limits. An RTGS can be done between 9 am to 4.30 pm from Monday to Friday and 9 am to 2 pm on Saturday.

RTGS Charges

  • - RTGS charges ranges between ₹ 25 to ₹ 52 per transaction
What is IMPS?

IMPS is an acronym for Immediate Payment Service. It is the latest electronic fund transfer facility which enables an instant interbank electronic fund transfer service through mobile phones. It is also being extended through other channels such as ATM, Internet Banking, etc. Through IMPS, the money is transferred instantly to the beneficiary’s account, in no time. Through IMPS we can transfer the money 24x7 throughout the year, all 365 days, even on bank holidays.

IMPS Charges

  • - Transactions up to ₹ 1 lakh – not exceeding ₹ 5 + service tax
  • - Transactions above ₹ 1 lakh and up to ₹ 2 lakhs – not exceeding ₹ 15 + service tax

Note: The minimum amount is ₹ 1 and maximum amount is ₹ 2 lakhs, which can be transferred via IMPS.