NEFT vs RTGS vs UPI vs IMPS: A Comparative Study
In todayโs digital era, electronic fund transfers have become the norm, revolutionizing how we transact money. Multiple options, such as RTGS, NEFT, UPI, and IMPS, are available. Let us delve into the blog better to understand these options.
NEFT: An Overview
It stands for National Electronic Funds Transfers and is a RBI-governed funds transfer method. NEFT started in November 2005 and is a safe and secure method of transferring small amounts of money.
Features
- Fees and Charges: Online NEFT transactions are free of charge and offline transfers cost up to โน50 in charges.
- Processing Time: Processing time is in under 2 hours. In some cases, it may also take up to 12 hours.
- Maximum Limit: There is no maximum limit per day for NEFT transactions.
RTGS: An Overview
It stands for Real-time Gross Settlement and is used to transfer higher amounts. RTGS ensures that the funds are transferred securely and without dependence on other transactions, thus minimizing risk.
Features
- Fees and Charges: RTGS online transfers do not have any levied charges.
- Processing Time: RTGS is the fastest method to transfer higher-value amounts, and the transaction is settled in real-time, under 30 minutes.
- Maximum Limit: The Reserve Bank of India (RBI) has not set any maximum transaction limit.
UPI: An Overview
It was launched in 2016 by the National Payments Corporation of India (NPCI) and stands for Unified Payments Interface. The unique feature of UPI is the ease of transferring money, this lets you send money from your bank account to another by simply entering someoneโs phone number, UPI ID, or scanning a QR code. This fund transfer facility is available through your mobile 24*7.
Features
- Fees & Charges: UPI payments service is free and does not charge any transaction fees.
- Processing time: UPI is an instant payment and transfer method.
- Maximum Limit: UPI’s maximum transaction limit per day is 1 Lakh.
IMPS: An Overview
It stands for Immediate Payments Service and was first established by NPCI in 2010. An IMPS funds transfer is a better fit for you than UPI as it allows immediate transfer of amounts up to 5 Lakhs.
Features
- Fees & Charges: IMPS transfer fees can range from โน2.5 to โน25 + GST depending on the amount value and choice of bank.
- Processing time: IMPS transfers amount usually within 30 minutes.
- Maximum Limit per day: The transaction limit of IMPS is 5 Lakhs.
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Comparison Chart
| Basis | NEFT | RTGS | UPI | IMPS |
|---|---|---|---|---|
| Minimum Transfer Limit | No minimum limit | โน2 Lakh | No minimum limit | No minimum limit |
| Maximum Transfer Limit | No upper limits (max. โน50,000 per transaction) | No limit | โน1 Lakh | โน5 Lakhs |
| Time Taken | Up to 12 hours (usually within 2 hours) | Real-time (within 30 Minutes) | Instant | Real-time (within 30 Minutes) |
| Service Availability | Online + Offline | Online + Offline | Online + Offline | Online + Offline (chargeable) |
Security | Safe, backed by RBI | Safe, backed by RBI | Safe, backed by NPCI | Safe, backed by NPCI |
| Service Fees | No charges on online NEFT transactionsOffline NEFT transactions are charging between โน2.5 to โน50 | No charges for online transactionsFor offline: โน2L to 5L transaction: up to โน25 applicableโน5L & above transaction: โน25 to โน50 applicable | Free of cost | โน2.5 to โน25 (varies from bank to bank) |
| GST charges | GST charges are applicable | No GST charges for online RTGS transactionโน15 + GST is charged for offline RTGS transaction | No charges | GST charges are levied |
| Service Availability during Bank Holidays | Available | Available | Available | Available |
| Suitability | Suitable for loan repayment and credit card payments | Suitable for transactions exceeding โน2 lakhs. | Suitable for instant transfers upto โน1 lakh | Suitable for transactions ranging between โน1 lakhs to โน2 lakhs |
| Operated by | RBI | RBI | NPCI | NPCI |
Charges
Letโs have a look at which one is cheaper NEFT vs RTGS vs UPI vs IMPS:
| Amount | NEFT | RTGS | UPI | IMPS |
|---|---|---|---|---|
| Below 2 Lakhs | Free | Not Applicable | Free | โน2.5 to โน15 + GST charges |
| 2 Lakhs to 5 Lakhs | โน25 to โน30 + GST charges if applicable | Free of cost | Not Applicable | โน2.5 to โน15 + GST charges |
| 5 Lakhs & above | โน25 to โน50 + GST charges if applicable | maximum โน50 + GST charges | Not Applicable | Not applicable |
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Conclusion
In conclusion, NEFT, RTGS, UPI, and IMPS are distinct electronic fund transfer systems with varying features and benefits. NEFT is suitable for small transactions, RTGS for higher amounts, IMPS for instant transfers up to 5 Lakhs, and UPI for quick transfers up to 1 Lakh without charges. Each method caters to different needs and preferences in online transactions.
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Frequently Asked Questions (FAQs)
What is the minimum amount for an IMPS transfer?
The amount transferable through an IMPS can be as low as Re.1.
What is the limit of IMPS in Indian bank?
Account holders can transfer up to Rs. 2 lakh through IMPS in a day.ย
Is RTGS mode of payment safe?
RTGS is a highly safe and secure mode of payment which is monitored by the RBI. It is even more secure as it is used majorly for money transfers of higher amounts.
Which is better, NEFT or UPI?
It depends on the user’s preferences and amount of transfer. While UPI transactions are processed instantly, NEFT transactions may take upto 2 hours to process.
Is IMPS a better mode of transfer than NEFT and RTGS?
IMPS allows immediate transfer of funds and this service can be accessed even on bank/public holidays. That is why this service is often considered better than NEFT and RTGS.
