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In India, fund transfer refers to the process of transferring money from one bank account to another, either within the same bank or between banks. Technological advancements and the expansion of the financial industry have resulted in the creation of different electronic payment systems and techniques for fund transfers.
There are several methods for moving funds from one bank account to another. With the advancement of technology, online money transfer has become the most convenient way to transfer funds from one bank to another. Here are the three most common methods of money transmission.
Depending on the preferences of the sender and receiver, as well as the availability of financial services, payments can be sent electronically, digitally, or by traditional ways.
- NEFT (National Electronic Funds Transfer)
- RTGS (Real-Time Gross Settlement)
- IMPS (Immediate Payment Service)
- UPI (Unified Payments Interface)
- Cheque-based Transfers
Let us discuss these methods of fund transfer in little more detail.
National Electronic Fund Transfer (NEFT)
The National Electronic Fund Transfer, or NEFT, is the most traditional basic and widely used method of transferring money from one bank to another. To complete any NEFT transaction, you just need two pieces of information: the account number and the IFSC code of the destination account.
There is no limit to the amount of money that may be transmitted using NEFT. Individual banks, on the other hand, may impose a restriction.
NEFT Money Transfer Procedures:
- Select ‘Transfer to Other Bank’ (NEFT) from the Fund Transfer menu.
- Choose the recipient account and fill out the necessary information.
- Accept the (Terms and Conditions).
- Double-check the details, if necessary, and complete the procedure.
Real Time Gross Settlement (RTGS)
A Real Time Gross Settlement, or RTGS, is comparable to NEFT except for the minimum payment and how it credits to the destination account.
You can use this if you wish to transmit more than two files. There is no limit to the amount. An RTGS money transfer occurs in real time. The bank of the individual to whom the funds are sent has 30 minutes to credit the funds to his or her account.
How to Make an RTGS Fund Transfer:
- Select ‘Transfer to other bank’ (RTGS) from the Fund Transfer menu.
- Choose the recipient account and fill out the necessary information.
- Accept the (Terms and Conditions).
- Double-check the details to ensure they are right and complete the process.
Please note that some banks have rtgs charges like the sbi rtgs charges, which are as follows:
1. For transactions up to ₹2 lakh: No charges.
2. For transactions above ₹2 lakh to ₹5 lakh: ₹25 per transaction.
3. For transactions above ₹5 lakh: ₹50 per transaction.
Immediate Payment Service (IMPS)
Immediate Payment Service (IMP) is a financial transfer service that may be used at any time. IMPS is simply NEFT+RTGS combined.
The transaction limit set quite low in order to minimise fraud accusations. You only need the destination account holder’s IMPS id (MMID) and cell phone number to make an IMPS transfer.
How to Make an IMPS Money Transfer:
- Log in to Net Banking/Mobile Banking using your Customer ID and Password.
- Select the Funds Transfer option (Other Bank Account).
- Choose a debit or credit account, an IMPS transfer mechanism, and a beneficiary account.
- Enter the amount to transferred and press the Submit button.
- Press the confirm button.
- Double-check all the information and confirm the transaction using an OTP (one-time password) sent to your registered cell phone number.
- Finally, click the submit button to confirm.
IMPS allows you to transfer money 24 hours a day, seven days a week, however RTGS and NEFT can only be done during working hours on weekdays and a few hours on Saturdays. Aside from NEFT, RTGS, and IMPS, you may also transfer money using UPI and check.
Unified Payments Interface (UPI):
Unified Payments Interface (UPI) is a real-time payment system that enables transactions to completed using any smartphone and a VPA (Virtual Payment Address).
For money transfers using UPI, no bank account information required. Only a cell phone number or name required, and transactions can be completed at any time. Apps that support UPI allow transactions of up to Rs 1 lakh.
Cheque-based Transfer:
Cheque You may use a check to transfer money from one account to another. Simply draught a cheque with your name as the payee and the account number to which you wish to transfer the funds, along with your signature. If the transfer is within your bank, it completed instantly at a branch.
With easier mediums of transactions comes better form of record keeping of all the transactions. Keeping track of bank account transfers in India is essential for preserving financial transparency, tracking transactions, and efficiently managing your funds. Here are several methods for keeping track of bank account transfers:
Passbook: All the accountholders get passbook at the time of opening bank account in India. For instance, SBI accountholders can avail SBI passbook at the time of opening bank account or can avail that later as well from the bank and get all the transactions updated from the bank itself.
Bank Statements:
Most banks issue periodical statements outlining all transactions, such as transfers, withdrawals, and deposits. These statements are available online through internet banking portals, or by email or regular mail.
Online Banking:
Check your account activities on a regular basis using your bank’s online banking portal. These systems often include transaction history and the ability to obtain transaction statements in a variety of formats.
Mobile Banking:
Banks frequently feature smartphone applications that provide real-time access to your account information. These applications allow you to see recent transactions and set up transaction alerts.
Thus, we can infer that there has been major revolution in banking due to the technology and internet and have catalytic effect of customer care and management. The advent of digital banking has transformed the banking industry and altered the whole process of basic bank transactions. It has aided clients in checking their account data, paying online bills, and transferring money from one account to another in a timelier manner.
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