Difference between IMPS and NEFT
Welcome to our comprehensive guide on the difference between IMPS (Immediate Payment Service) and NEFT (National Electronic Funds Transfer). In this article, we will explore what IMPS and NEFT are, their examples, uses, and also provide a detailed differences table. So, let’s dive in!
What is IMPS?
IMPS is a real-time interbank electronic funds transfer system in India. It enables instant, 24×7 electronic money transfers between banks through mobile phones, internet banking, and ATMs. IMPS is managed by the National Payments Corporation of India (NPCI).
Examples of IMPS
1. Transferring money from your bank account to a friend’s bank account instantly.
2. Paying your bills, such as electricity, water, or telephone bills, directly through your bank account.
Uses of IMPS
- Instant money transfer
- 24×7 availability
- Convenient payments
- Remittance services
- Splitting bills with friends or family
What is NEFT?
NEFT is a nation-wide electronic funds transfer system in India. It operates on a deferred net settlement basis, where transactions are processed in batches. NEFT transfers funds between bank accounts held with different banks through a centralized system.
Examples of NEFT
1. Receiving your salary from your employer directly into your bank account.
2. Making online purchases by transferring funds from your bank account to the merchant’s account.
Uses of NEFT
- Salary payments
- Online purchases
- Loan repayments
- Recurring payments
- Business-to-business transactions
Differences between IMPS and NEFT
| Difference Area | IMPS | NEFT |
|---|---|---|
| Transaction Speed | Immediate | Deferred (usually within hours) |
| Availability | 24×7, including weekends and holidays | Operational during banking hours only |
| Transaction Limits | Higher transaction limits | Lower transaction limits |
| Processing Fees | Higher fees for some banks | Lower fees for most banks |
| Transfer Channels | Mobile phones, internet banking, ATMs | Internet banking, branch visits |
| Settlement Frequency | Real-time settlement | Batches settled every hour |
| Minimum Transaction Amount | No minimum amount requirement | Minimum amount as specified by the bank |
| Transaction Confirmation | Instant confirmation | Confirmation within a few hours |
| Reversal of Transaction | Not possible in most cases | Possible within a limited time period |
| Usage of Unique Codes | Uses MMID (Mobile Money Identifier) or IFSC (Indian Financial System Code) | Uses IFSC (Indian Financial System Code) |
Conclusion:
In summary, while both IMPS and NEFT are electronic funds transfer systems in India, they differ in terms of transaction speed, availability, transaction limits, fees, transfer channels, settlement frequency, and more. IMPS provides immediate transfers with higher transaction limits and allows usage of mobile phones, while NEFT operates on a deferred settlement basis within banking hours. Use the appropriate system depending on your requirements for convenient money transfers.
People Also Ask:
Q: How long does an IMPS transfer take?
A: IMPS transfers are usually instant and occur in real-time.
Q: Can I use NEFT for international money transfers?
A: No, NEFT only facilitates national electronic funds transfers within India.
Q: Are there any transaction fees for using IMPS/NEFT?
A: Yes, banks may charge nominal fees for IMPS and NEFT transactions. The fees vary based on the bank and transaction amount.
Q: Can I transfer money using IMPS/NEFT on weekends?
A: Yes, you can transfer money using IMPS on weekends, while NEFT is not operational on weekends.
Q: Can I reverse a wrongly transferred amount using NEFT/IMPS?
A: While NEFT allows for reversal within a limited time, IMPS transactions are usually irreversible. It is advisable to be cautious while entering the beneficiary details.
