When did people need to transfer money from bank accounts then We have three options: RTGS, NEFT, and IMPS. A special service that allows transferring funds electronically to accounts from other banks. So, let’s see What is the difference between RTGS, NEFT, and IMPS?
What is RTGS?
RTGS stands for Real-Time Gross Settlement. This is a funds transfer system where money is moved from one bank to another in real-time that’s why it is called Real-Time Gross Settlement.
RTGS fund transfer option is basically designed for high transaction amounts.
Because there is no maximum limit on the transfer amount. and you need to transfer a minimum of 2 lakhs rupees at a time.
When the transaction amount is high, payment needs to be processed immediately then the perfect option is only RTGS.
The few details required for an RTGS transfer like:
- Name of the beneficiary
- Account number and account type
- Name of the bank
- Indian Financial System Code (IFSC) of the bank
What is NEFT?
NEFT stands for National Electronic Funds Transfer. It is a 24*7 available service of funds transfer and the transaction gets processed in approx half an hour.
The Reserve Bank Of India has not specified any minimum or maximum limit on the fund transfer amount.
The few details required for an NEFT transfer like RTGS:
- Name of the beneficiary
- Account number and account type
- Name of the bank
- Indian Financial System Code (IFSC) of the bank
What is IMPS?
IMPS stands for Immediate Payment Service. It is an instant interbank electronic fund transfer service through mobile phones.
Transferring funds in real-time and 24X7X365 interbank was a major challenge faced in the banking industry. Only NEFT & RTGS were available to users for fund transfer during banking hours.
The IMPS service is available 24×7 throughout the year including bank holidays.
It is used to build the foundation for a big range of mobile-based Banking services.
Difference between NEFT and RTGS
The following are the main differences between NEFT and RTGS-
| Point of Difference | NEFT | RTGS |
| Minimum Amount to be Transferred | Rs. 1 | Rs. 2 Lakh |
| Maximum Amount to be Transferred | No limit | No limit |
| Type of Settlement | Amount settled in batches | Amount settled one-on-one |
| Settlement Time | 2 hours | Immediate |
| Transfer Timings | 24*7, all 365 days | Varies from bank to bank |
| Mode of Transfer | Both- online and offline | Both- online and offline |
| Additional charges | No charges applicable | Rs. 30 on outward transactions between Rs. 2 lakh and Rs. 5 lakh; Rs. 55 on outward transactions of more than Rs. 5 lakh |
The main difference is that NEFT has no minimum or maximum limit on the fund transferred, but RTGS transactions can only be performed if the amount to be transferred is equal to or more than Rs. 2 lakh.
Charges on Transactions: NEFT vs RTGS
Additional Charges on RTGS Transactions-
| Type of Transaction | Charges Applicable |
| Inward transactions | No charges |
| Online transactions (Internet/Mobile Banking) | No charges |
| Outward transactions (amount = Rs. 2 lakh – Rs. 5 lakh) | Rs. 30 |
| Outward transactions (amount < Rs. 5 lakh) | Rs. 55 |
Additional Charges on NEFT Transactions-
| Transaction Amount | Fee Amount |
| Less than or equal to Rs. 10,000 | Rs. 2.5 |
| Between Rs. 10,000 and Rs. 1 Lakh | Rs. 5 |
| Between Rs. 1 Lakh and Rs. 2 Lakh | Rs. 15 |
| Equal to or more than Rs. 2 Lakh | Rs. 25 |
Conclusion
So, after reading the above article you understand What is the difference between RTGS, NEFT, and IMPS. Please share your suggestion about my article in below comment box.