When we think of transferring funds through our Bank account the thought always comes in mind which option is preferable NEFT or IMPS.
Let’s see which one is better.
NEFT stands for National Electronic Funds Transfer and IMPS stands for Immediate Payment Service. NEFT transaction can be processed one to one between different Banks whereas in case of IMPS one can transfer funds within same bank and between different banks accounts.
Unlike older days of Banking, in present day scenario you can transfer funds to your friends, relatives and for various other reasons through Mobile Banking and Online Banking. It has saved time, paper and waiting for cheque transactions. By introducing such facilities now you have bank on your fingertips.
What is NEFT and IMPS?
In NEFT, the money is transferred in batches and settlement happens in periodical hourly course of batches. While in IMPS, the money can be transferred immediately anytime, anywhere across India.
Transfer time duration
In the case of NEFT transfer, under normal circumstances the funds from the remitting bank will be sent to the RBI within three hours of the transaction. However, the actual time taken to credit the beneficiary bank's branch account depends on the time taken by the beneficiary bank to process the payment. On the contrary, in IMPS, the money is transferred immediately across the country.
Charges for transfer
Since the cost incurred in processing both NEFT and IMPS, Banks are charging as per their product offerings. In programmed Accounts the charges for both the facilities are waived / removed. Where ever the charges are applicable it’s marginal.
NEFT as well as IMPS can be processed via Internet Banking System and Mobile Banking System.
Timings for bank transfer
In case of NEFT any request received after cut off time gets processed next day only even though you want to transfer money immediately due to an emergency, the batch system does not permit and due to this NEFT is not a good option in case of emergency after batch hours. IMPS facility is available 24*7. Hence, even if you transfer money by IMPS at late night, it will be immediately transferred to the other party’s bank account instantly. This is the major advantage which IMPS carries over NEFT.
Anytime and anywhere
The main advantage of IMPS facility over NEFT is it works on 2nd and 4th Saturdays, Sundays and even on Holidays as well. India has a big list of Holidays annually due to Festivals. Hence, NEFT is not suitable for those who want to transfer money during 2nd and 4th Saturdays, Sundays and Holidays. IMPS is an additional benefit for those in emergency and would like to transfer monies immediately, be it any Holiday in India.
IMPS is beneficial than NEFT. One can process IMPS transactions anytime and anywhere in India by Mobile Banking and Internet Banking.