NEFT vs RTGS

This is the sixth and last post in the series of Jargons of Online Banking.

Time Limit:
In NEFT, settles the transactions in batches. The settlement takes place at pre-decided points of time. All transactions are held up till that time. Any transaction initiated after a designated settlement time would have to wait till the next designated settlement time. Contrary to this, in RTGS, transactions are processed continuously throughout the RTGS business hours.

Charges:
Sender might have to pay up to Rs 25 in case of NEFT and up to Rs 50 in case of RTGS.

Minimum Limit on amount of Funds Transfer:
RTGS need that funds transferred should be at least Rs 1 Lakh. There is no such limit in NEFT transfers.

Maximum Limit on amount of Funds Transfer:
No Limit on any of them.

RTGS

This is the fifth post in the series of Jargons of Online Banking.

RTGS stands for Real Time Gross Settlement.

It is a fund transfer mechanism where money transfer takes place from one bank to another without any waiting time or in real time. Transactions are settled as soon as they are processed.

It is primarily for large amounts, where minimum amount is supposed to be Rs 1 Lakh.

RTGS transfers can be initiated anytime between 9 AM to 4:30 PM on weekdays and 9 AM to 12:30 PM on Saturdays.

Receiver of the funds has not to pay any charges. Sender might be charged up to Rs 25 for funds transfer up to Rs 5 Lakhs and up to Rs 50 for funds transfer requests exceeding Rs 5 Lakhs.

Not all the banks are yet supporting RTGS; latest list can be found at RBI's site.

Online Banking - Introduction of Jargons

Online banking or Internet banking generally throws some of its own jargons.
I'll be hosting a series on this blog where I'll try to share my notes of some of those jargons.

Jargons covered will be:

MICR Code

IFSC Code

NEFT

How NEFT Works

RTGS

Neft vs RTGS

Stay tuned to read more about them.