IMPS vs NEFT - The difference between IMPS and NEFT fund transfer
29 / 07 / 2024
These days, one is spoiled for choice when choosing the payment method. Amongst them, EFT or Electronic Fund Transfer, stands out as one of the most utilised methods for transferring money between accounts.
The banks facilitate a seamless and effective process for transferring funds. There exist various types of EFT, including RTGS, UPI, IMPS, NEFT, and more. Among these, the two most favoured methods for transferring money in India are IMPS (Immediate Payment Service) and NEFT (National Electronic Funds Transfer). While both services offer a dependable means of transferring funds between bank accounts, they possess distinct differences.
What is IMPS ?
IMPS stands as the go-to service for securely transferring money between banks at any time of day or night. This handy service, introduced by the National Payments Corporation of India (NPCI) in 2010, ensures that your money swiftly reaches its destination. Whether you utilise your mobile phone, internet banking, or an ATM, IMPS simplifies sending money and makes it effortlessly easy.
Key features of IMPS
- Instant Transfer - With IMPS, your funds are transferred quicker than a blink of an eye, making it ideal for urgent situations.
- Availability - IMPS operates round the clock, 365 days a year – even on bank holidays.
- Accessibility - Whether you opt for mobile banking, internet banking, or a trusty old ATM, IMPS has got you covered, providing multiple avenues to access its rapid service.
- Confirmation - Bid farewell to nail-biting moments while awaiting confirmation. IMPS furnishes instant transaction confirmation to both sender and receiver, ensuring peace of mind that your money is securely placed.
What is NEFT?
NEFT serves as the workhorse for India's banking system, furnishing a reliable and efficient means to transfer funds between bank accounts nationwide. Managed by the Reserve Bank of India (RBI) and introduced in 2005, NEFT is tailored for one-to-one transactions, guaranteeing the safe arrival of your money, albeit not as instantaneously as IMPS. Instead, NEFT processes transactions in batches.
Key features of NEFT
- Batch Processing - Unlike the immediate fulfillment of IMPS, NEFT transactions are handled in batches. Thus, your money takes up to two hours to reach its destination.
- Timings - NEFT payments are available 24x7 for the convenience of the users.
- No Minimum or Maximum Limit - Whether you're transferring a little or a lot, NEFT imposes no minimum or maximum transfer limits, making it versatile for all transaction sizes.
- Secure and Reliable - With the RBI steering the ship, NEFT stands as a secure and trustworthy method for transferring funds, ensuring your money is in safe hands.
Differences between IMPS and NEFT
Both IMPS and NEFT possess unique advantages, catering to different needs. Whether you require the instant satisfaction of IMPS or the steadfast reliability of NEFT, comprehending these differences aids in selecting the appropriate service for your specific requirements.
IMPS vs NEFT
| Concepts | IMPS | NEFT |
| Transfer Speed | Instant fund transfer, typically within a few seconds. | Processed in hourly batches, meaning funds are not transferred immediately but within a few hours during operational hours. |
Transfer Limits | Generally, there is a limit on the maximum amount that can be transferred per transaction, which varies from bank to bank. | No minimum or maximum transfer limit, making it versatile for various transaction sizes. |
Transaction Charges | Banks may charge a fee for IMPS transactions, which can vary based on the amount transferred. | Transaction charges for NEFT are generally lower than IMPS charges and are regulated by the RBI, often making it a more cost-effective option for many users. |
Use Cases | Best suited for urgent and immediate fund transfers, such as emergency payments or quick money transfers to friends and family. | Best suited for non-urgent transactions, accommodating both small and large amounts without any transfer limits. |
Choose IMPS or NEFT Based on your needs
Both IMPS and NEFT furnish convenient electronic fund transfer options, each with distinct benefits. IMPS excels in urgent transactions, whereas NEFT proves adept at handling routine transactions, accommodating both small and large amounts without any transfer limits.
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