Electronic or e-transfer of funds refers to the transfer of money from one bank account to another without dealing with bank staff. NEFT or National Electronic Funds Transfer, RTGS, or Real Time Gross Settlement and IMPS or Immediate Payment Service are three such platforms of money transfer available now.
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Let's understand these services in detail:
NEFT
National Electronic Funds Transfer (NEFT) is a nation-wide centralised payment system owned and operated by the Reserve Bank of India (RBI).
NEFT offers the following advantages for funds transfer or receipt:
RTGS
RTGS' stands for Real-Time Gross Settlement, which can be explained as a system where there is a continuous and real-time settlement of fund-transfers, individually on a transaction by transaction basis (without netting).
'Real Time' means the processing of instructions at the time they are received; 'Gross Settlement' means that the settlement of funds transfer instructions occurs individually.
Considering that the funds' settlement takes place in the books of the Reserve Bank of India, the payments are final and irrevocable.
RTGS offers many advantages over the other modes of funds transfer:
IMPS
IMPS is a payment service managed by the National Payments Corporation of India (NPCI). This service enables individuals to make money transfer instantly through banks across the country.
It is available round the clock throughout the year, even on bank holidays.
(Edited by : Jomy)
First Published: Oct 30, 2020 3:08 PM IST
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