What is NEFT?
NEFT stands for national electronic funds transfer. NEFT is an online money transfer service that is comparable to IMPS. this is another fantastic online transfer funds option that is available in India and enables a one-to-one money transfer from one individual to another. NEFT, unlike IMPS, requires banking information in order to use it. The service is not accessible to all banks. They must participate in the India NEFT transfer network.
What is RTGS?
RTGS stands for real-time gross settlement, it refers to the process through which funds are moved instantly and without delay from one bank account to another. If you need to transfer a sum equal to greater than 2 lakhs in real time, RTGS turns out to be the ideal payment option. Contrary to NEFT, RTGS does not adhere to any particular processing methodology, as a result, the money is settled instantly and without any delays. Every transaction and instruction are executed using RTGS, which streamlines and expedites the money transfer procedure.
NEFT Vs RTGS | Difference between NEFT and RTGS:
- There is no minimum transfer ceiling for the NEFT technique. The minimum amount needed to be transferred has to be Rs 2 lakhs and above for RTGS.
- Through NEFT, transactions of any amount can be sent to the recipient account without any maximum limit to the funds that can be sent in a day. In RTGS, a Large number of funds can be used to transfer instantly with the real-time gross settlement. The transaction speed is faster than any other form of online payment.
- The NEFT mode is used when the transaction is smaller values. RTGS is used in high-value transactions.
- In NEFT, the settlement of funds happens on a half-hourly basis. In RTGS, The settlement of funds is instantaneous and happens in real time.
- The NEFT system was introduced in November 2005 to replace the special electronic fund transfer system that was in use at the time. The RTGS system was first implemented in India in march 2004 as a major technology-based electronic funds transfer system across the country.
- When NEFT transactions fail or are not processed on time, destination banks are required to return the fund to the originating branch within two hours of completion of the batch in which the transaction was processed. In RTGS the event that a transaction fails, the money is credited into the sender's account once the money is received back by the remitting bank. The fund is returned to the originating bank within one hour or before the end of the RTGS business day or whichever comes first.
- The funds transferred through NEFT are processed in 12 batches between 8 AM to 6:30 PM on weekdays and between 8 AM and 1 PM on Saturdays. It was not available on Sundays and bank holidays. The RBI has allocated the following time slots for RTGS 9 AM - 4:30 PM on weekdays, and 9 AM - 1:30 PM on Saturdays.