NEFT, RTGS, and IMPS are the most common payment and settlement systems in India. If you’re a business owner in India and you want to start implementing digital transactions in your business, so you should have knowledge about net banking and card payments.
If you already know, that’s good. If you don’t know, let’s Learn about the RTGS, NEFT, and IMPS and the differences between these systems.
What are NEFT, RTGS, and IMPS?
What is RTGS?
Stands for Real-Time Gross Settlement (RTGS ). This is a real-time funds transfer system that enables you to transfer funds from one bank to another, in real-time, or on a gross basis transferred amount is immediately deducted from the account of one bank, and instantly credited to the other bank’s account. The RTGS payment gateway is maintained by the Reserve Bank of India. The transactions between banks are made electronically.
RTGS can be used by individuals, companies, and firms to transfer large sums of money. Before remitting funds through RTGS, you will need to add the beneficiary and his bank account details via your online banking account. In order to complete this registration, you will require the following information:
- The Name of the beneficiary
- Beneficiary’s bank address
- Beneficiary’s account number
- Beneficiary’s bank’s IFSC code
What is NEFT?
Stands for National Electronic Funds Transfer (NEFT ). This money transfer system allows you to electronically transfer funds from your respective bank accounts to any other account, either in the same bank or belonging to any other bank. NEFT can be used by individuals, firms, and corporate organizations to transfer funds between accounts. In order to transfer funds via NEFT, two things are required:
- A transferring bank
- A destination bank
Before you can transfer funds through NEFT, you will need to register the beneficiary who will be receiving the funds. In order to complete this registration, you will require the following:
- Recipient’s name
- Recipient’s account number
- Recipient’s bank’s name
- Recipient’s bank’s IFSC code
What is IMPS?
Stands for Immediate Payment Service (IMPS). This is a real-time, inter-bank, electronic funds transfer system used to transfer money instantly within banks across India.
IMPS enables users to make instant electronic transfer payments using mobile phones through both, Mobile Banking and SMS. It can also be used through ATMs and online banking. IMPS is available 24 hours a day and 7 d confirm orders that have been fulfilled.
To transfer money through IMPS, you need to:
- Register for IMPS with your bank
- Receive a mobile money identifier (MMID) from the bank
- Receive an MPIN from the bank
- The beneficiary’s mobile number
- The beneficiary’s MMID
- The transfer Amount
- Your MPIN
Once you have both these, you can log in or make a request through SMS to transfer a particular amount to the beneficiary. From the beneficiary to receive the transferred money, he must
- Link his mobile number with his respective account
- Receive the MMI9D from the bank
In order to initiate a money transfer through IMPS, you will need to enter the following information:
As soon as money has been deducted from your account and credited into the beneficiary’s account, you will be sent a confirmation SMS with a transaction reference number, for future reference.
