In this article, you will learn about the difference between IMPS and NEFT. Do you know! There have been a lot of queries regarding different modes of electronic payments like IMPS, NEFT, RTGS, and net banking.
In today’s world of digitization and high-speed life, it becomes of utmost importance that we save our valuable time in doing online transactions instead of going to banks and standing up in a long queue for hours. So let’s understand what are different modes of digital transactions are and how these systems work.
Difference between imps and neft:
The full form of NEFT is a national electronic fund transfer. It is an electronic mode of payment from one bank to another in a batch settlement. It was established in November 2005 and is fully owned and operated by RBI.
- It is 24*7 service.
- Provide positive confirmation to sender/remitter/payer by e-mail or SMS on crediting amount to beneficiary’s account.
- No fee levied by RBI on banks for transferring amount. This section will be discussed in detail further.
- Besides fund transfer, NEFT can be used to pay credit card dues, EMI of loans, inward foreign exchange remittances etc.
Now we come to IMPS which is another mode of electronic payment. The full form of IMPS is an Immediate Payment Service launched by Smt. Shyamala Gopinath, DG, RBI, Mumbai on 22nd November 2010. This service is provided by the National Payment Corporation of India (NPCI) through its existing National Financial Switch (NFS).
Essential features of IMPS:
- It is instant and real time payment settlement
- Service is available for 24*7
- It can be accessed via mobile, internet, ATMs etc.
- It is safe, secure and easily accessible to customers
- It is an immediate fund transfer hence payment can not be stopped or cancelled once started.
Limit for IMPS:
The per transaction limit for IMPS has been increased from 2 lakh to 5 lakh
What is MMID?
MMID stands for Mobile Money Identifier. It is a number comprising 7 digits issued by the banks. It is in favor of beneficiary. When this number is clubbed with mobile number, it facilitates fund transfer.
Another mode of electronic payment is RTGS which stands for Real Time Gross Settlement. Real time means processing of instruction occurs only when they are received. Gross settlement refers that settlement of fund transfer occurs individually.
Essential features of RTGS:–
- It is safe and secure mode of payment system
- It has no limit on transacted amount
- System is available for 24*7*365
- Payer or sender does not need to use any cheque or demand draft
- Sender does not need to visit bank branch physically. They can do it via net banking
The major difference between neft and rtgs is that in neft transaction received are processed at a particular time in batch system whereas in rtgs it is a continuous process.
What are the essential information required by the remitter/sender to transfer fund through RTGS?
- Amount which is send to beneficiary
- The account number to be debited
- Beneficiary’s bank name and branch name
- Beneficiary’s name and his/her bank’s IFSC number
- Account number of the beneficiary
Minimum or maximum limit of transaction:
The minimum amount of transaction in rtgs is Rs. 2 lakh and there is no upper limit on amount transferred.
Processing charges for rtgs transaction:
No charges are levied for inward transaction
For outward transaction there are some charges imposed- 2 lakh to 5 lakh: Rs. 24.50/-
Above 5 lakh: Rs. 49.50/-
What is UTR number:
UTR stands for Unique Transaction Reference. It is a 22 character code that is used to identify a transaction uniquely in rtgs system.
Is a customer eligible for any compensation for delay in payment?
In case of any delay in payment or failed transaction, sender or payer is eligible to receive a compensation at current Repo rate plus 2 percent.
Now e-payment has become a simple, easy and a convenient process, which is cost effective as compared to the earlier days of online payment. With the implementation of IMPS (Immediate Payment Service), RTGS and NEFT, the online transactions now have more transparency and flexibility than ever before in its previous versions.
The KYC (Know Your Customer) guidelines implemented by the RBI have made it more convenient to carry out e-payments. The entire transaction is tracked through the respective RBI centers and no steps are spared to maintain high security and keep a check on financial irregularities. Thus digital mode of payments has made our life very convenient. Thanks:)