Differences between NEFT, RTGS, and IMPS

There was a time when you had to wait for several days to get a definite status of money transfer to or from your account. As the technology was embraced by the banking system, digital mode of payments and transfers made the process faster and easier. Nowadays, you can actually send money in real time and the status is visible in the account or via SMS alerts almost instantly. There are three main modes of online money transfer, namely IMPS, NEFT and RTGS.

Different types of Transactions

NEFT, RTGS, and IMPS are the important parts of an electronic clearing system and they can be repeated as and when needed. They can happen on mass basis.

· National Electronic Funds Transfer (NEFT):

In this mode of money transfer, both the sender and the beneficiary have to be on NEFT network. It is not a real time transfer and takes place every 60 minutes. Once you initiate the transfer, the money is deducted from your account in the next settlement cycle and the beneficiary gets it within few hours. The settlement can take a few hours to complete.

· Real Time Gross Settlement (RTGS):

In this system, the funds are transferred to the beneficiary account in real time. It is accounted in the RBI’s books. Big organizations use RTGS when they need real time transactions where the huge sum is involved. A RTGS transfer is irreversible and cannot be changed.

· Immediate Payment Services (IMPS):

This system is developed while keeping consumer centric services in the mind. It can be done via a web portal, mobile application or even via mobile phone services.

The Timings

Generally, the timings of the transfers may vary from bank to bank. In some cases, it may show immediately, but in other cases, it may take more than usual time. As per rules, the transfers initiated on a particular date should be cleared on the same day if the settlement is possible on the same day.

· NEFT:

The settlement cycle takes place every 60 minutes. The timing of the NEFT transfer is mostly 11 hours on weekdays and 5 hours on Saturday. NEFT is not initiated on Sundays and holidays. In case you initiate payment after the scheduled time, it will get initiated on the next working day.

· RTGS:

RTGS works almost same as NEFT. The main difference is that it happens in real time. You can take the advantage of RTGS till the last working hour. However, after working hours it will not get initiated and on Saturdays, the service is available only for half day. Sundays and bank holidays are off for RTGS as well.

· IMPS:

It is a 24-hour service which you can avail at any time on any day irrespective of a bank holiday or working day.

What do you need to initiate transfer?

The requirement for RTGS and NEFT are same but for IMPS it is slightly different.

· RTGS and NEFT

a. First of all both the sender and the beneficiary should be part of the respective system.
b. Account number of the beneficiary
c. Beneficiary’s IFSC code
d. Access to mobile banking for OTP

· IMPS

a. Both sender and beneficiary should be part of IMPS system
b. Either the MMID or IFSC and account number of the beneficiary
c. Nowadays IMPS can be initiated via Aadhaar numbers as well

Sender’s MPIN

Transfer Limits

There is no minimum amount for the transfer.

· NEFT: The maximum amount per transaction differs from bank to bank. It can vary from 5 lakhs to 10 lakhs.

· RTGS: The maximum amount per transaction can be up to 2 lakhs.

IMPS: The maximum amount varies from bank to bank. In most of the cases, it is up to Rs 2 lakhs per transaction.