If you’re making a bank transfer within India (bank to bank), you will come across one of these three acronyms: NEFT, RTGS or IMPS. All three options are provided by banks for online money transfers, so what do they mean - and what does it mean for you?
What is IMPS?
The Immediate Payment Service, as its name indicates, is a real-time funds transfer facility provided by banks in India for domestic transfers.
With nearly 500 banks participating in IMPS, it is highly likely that your bank will offer you this option. You can do interbank transfers using IMPS via SMS, your bank’s mobile app, netbanking and in-person at a branch.
IMPS benefit includes the fact that it is available 24/7 - 24 hours a day, 7 days a week, 365 days a week. Other bank transfers are limited to banking hours - this is not so with IMPS meaning you can send transfers on the weekends, late at night and so on and have the funds credited to the recipient’s account immediately.
To send funds via IMPS, you will need the recipient’s:
- Aadhaar number or
- Account number and bank’s IFSC, or
- Mobile number and MMID that is generated
Due to it being instant, IMPS transfers are usually capped at ₹2,00,000 (check with your bank). The benefit of being able to send funds by just using your recipient’s mobile number is immense (if they have registered for such a facility).
What is NEFT?
The National Electronic Funds Transfer or NEFT is a system for domestic interbank transfers within India. NEFT enables companies and individuals to send funds from one bank to another bank digitally.
To send funds to a recipient, you will need the recipient’s account number and the bank’s IFSC.
Receiving a NEFT transfer is free, and for most banks, sending a NEFT transfer has no charges as well. There is no maximum amount to send NEFT - making it a good option if you are sending large amounts vs IMPS. NEFT is available during banking hours (8am-7pm IST), meaning that all settlements will happen during this window (not on banking holidays). Since settlements are done in 30 minute batches, your funds will be settled every 30 minutes, and funds credited to the recipients account within 2 hours post that.
NEFT has the added advantage of being able to send and receive funds from NRE/NRO accounts for Non-Resident Indians.
What is RTGS?
RTGS stands for Real-Time Gross Settlement and is another way of sending funds online between banks within India. Similar to IMPS, it is real-time - meaning that funds happen in real-time (as we showed above, NEFT is not real-time). However, unlike IMPS, funds cannot be sent 24/7 - RTGS transfers are available during banking hours (until 6pm IST).
RTGS is ideal for sending large transfers as the minimum amount is ₹2,00,000 (with no maximum amount).
Similar to NEFT transfers, you will need the recipient’s bank account number and bank IFSC to send an RTGS transfer. RTGS transfers are instant, and will never take more than 30 minutes to be credited to the recipient’s account. Due to the minimum amount, they are a good way to send large transfers quickly and easily.
So, what’s the difference between RTGS vs NEFT vs IMPS?
| ||IMPS||NEFT||RTGS |
| Settlement Time||24 hours/7 a week /365 days ||Bank working days, 8am-7pm ||Bank working days, 8am-7pm |
|Settlement Processing||Immediately|| 30 minute batches||Immediately |
| Limits||No minimum. Usually, maximum is ₹2,00,000 ||No minimum. No maximum but depends on the bank. ₹50,000 if using cash in-person ||Minimum is ₹2,00,000. No maximum. |