rtgs & neft by rohan prakash @ bmsb
TRANSCRIPT
Is there no other option for money transfer which quickly transfers money from one bank account to
another bank account?
NEFT and RTGS are two convenient modes of money
transfer between banks in India
RTGS stands for “Real Time Gross Settlement” – It enables transfer of
money in real time.NEFT stands for “National
Electronic Funds Transfer” which is an online system of transferring
funds between financial institutions,
In RTGS the beneficiary bank credits the beneficiary’s account in a span of two
hours after receiving the funds transfer message. RTGS transactions are
processed throughout the working hours of the system.
NEFT is done on a net basis where the bank clubs transactions together and only
the net amount is transferred. This settlement usually takes place 12 times a
day on weekdays and 6 times on Saturdays. NEFT takes place within the same day if it is within the cut off time
and the next working day if it is beyond the cut-off time.
• The acronym 'RTGS' stands for Real Time Gross Settlement
• RTGS system is a funds transfer mechanism where transfer of money takes place from one bank to another on a 'real time' and on 'gross' basis
• This is the fastest possible money transfer system through the banking channel
• Settlement in 'real time' means payment transaction is not subjected to any waiting period. The transactions are settled as soon as they are processed
• 'Gross settlement' means the transaction is settled on one to one basis without bunching with any other transaction
• Considering that money transfer takes place in the books of the Reserve Bank of India, the payment is taken as final and irrevocable
• The acronym “NEFT” stands for National Electronic Funds Transfer.
• Funds are transferred to the credit account with the other participating Bank using RBI's NEFT service.
• RBI acts as the service provider and transfers the credit to the other bank's account.
NEFT operate on a deferred net settlement (DNS) basis which settles transactions in batches.
In DNS, the settlement takes place at a particular point of time. All transactions are held up till that time
Type Minimum Maximum
RTGS Rs. 2 Lakh No Limit
NEFT No Limit No Limit
(abroad facility only in Nepal 50,000 max)
* HOWEVER MAXIMUM AMOUNT PER TRANSACTION IS LIMITED TO RS 2,00,000
RTGS transactions will be sent to RBI based on the following schedule:
Day Start Time End Time
Monday to Friday 9:00 hrs 16:00 hrs
Saturday 9:00 hrs 13:30 hrs
NEFT transactions will be sent to RBI based on the following schedule:
Day Start Time End Time
Monday to Friday 8:00 hrs 19:00 hrs
Saturday 8:00 hrs 13:00 hrs
• The essential information that the remitting customer would have to furnish to a bank for the remittance to be effected
Amount to be remitted
Account number which is to be debited
Name of the beneficiary bank
Name of the beneficiary customer
Account number of the beneficiary customer
Sender to receiver information, if any
The IFSC Number of the receiving branch
It depends on the arrangement between the remitting customer and the remitting bank.
Some banks with internet banking facility provide this service.
Once the funds are credited to the account of the beneficiary bank, the remitting customer gets a confirmation from his bank either by an e-mail or by a short message on the mobile
Majority of commercial banks have employed RTGS and it is available in
over 30472 branches
NEFT facility is available in 32407 branches of banks. These branches
may be in remote corner of the country also
BENEFITS
Available to all All our Net banking (existing & new) users are eligible to utilize this on-line facility.
It's simple, convenient, quick and secure Users can transfer funds to the beneficiaries in other banks in a simple, convenient and
seamless manner.
Funds transfer to other banks is faster, secure and safe
Anytime, anywhere... Simple and easy to operate - from home / office anytime, anywhere
Save time and energy
Get more for less RTGS/NEFT cost less than the conventional modes of remittance such as DD/MT
To conclude I’ve tried to summarize the key differentiation in these concepts through diagrams in the next 2 slides