Interbank means between banks and electronic transfer is for the fund transfer with help of a electronic network. Real Time Gross Settlement (RGTS), National Electronics Fund Transfer (NEFT), Immediate Payment Service (IMPS) are major payment methods used in electronic fund transfer between the banks in India. Some notable advantages of this mode of fund transfer over the conventional cheque transactions are:
- Transactions can be made from anywhere using mobile or internet
- This mode of fund transfer is much more safer than physically carrying money or cheque
- The money will be credited or debited faster than physical banking.
- This mode of payment ensures minimal transaction mistakes over the conventional difficult method. Here the payment is channeled with help of receivers account number and the IFSC code (Indian Financial System Code – a specific code for the bank or branch of bank).
NEFT, RGTS and IMPS in detail.
- NEFT is an electronic transfer mode that enables the user to transfer money within accounts of same bank or other banks. For this the user must have a valid bank account enabled with electronic fund transfer. For the transaction, the user must add the receiver as beneficiary on his account via internet. For this user must have the Name of receiver (as per bank records), account number, and the specific banks IFSC code. There is no minimum amount for transaction whereas the maximum limit is RS.10 lakhs.
- RGTS, this fund transfer is mainly used for transferring large sum of money. This also works similar to the NEFT transfer. The minimum amount for transaction is Rs.2 lakhs, whereas there is no upper limit. The fund is deduced in real time from the users account and deposited on the receivers account. There is no delay faced for clearance. Like NEFT, here also the user must add the receiver as beneficiary on his account.
- IMPS is an electronic mode of payment mainly for mobile devices. Here also there is no delay faced in debiting and crediting of money. For this, the user must link his mobile number to the bank and obtain a MMID (mobile money identifier) and MPIN. The receiver must also be enabled with IMPS transfer by registering his mobile number on respective bank. Now using the beneficiaries mobile number, MMID the funds can be transferred.
Recommended Read :
- How is Fund Transfer done?
- What is a Bank Draft?
- What is Wire Transfer?
- What is a Money Order?
- IMPS vs NEFT
- How does Fund Transfer work?
- What is RTGS?
- RTGS vs NEFT
- Fund Transfer