Three ways to transfer money by mobile, online banking

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In September 2019, around 1.11 billion transactions, for a value of ??$ 4.70 trillion, was made through mobile banking in India. Much of these transactions involve money transfers. There are three methods by which you can transfer funds through mobile banking: national electronic funds transfer (NEFT), real-time gross settlement (RTGS), and immediate payment service (IMPS). We tell you what it is and how you can transfer funds using them.

NEFT

This method can be used by individuals, businesses and businesses to electronically transfer funds from an account at any bank branch to any individual, company or business with an account in another bank branch in the country with the NEFT facility. Even people who don’t have a bank account (walk-in customers) can deposit money at NEFT-enabled branches with instructions for transferring funds using NEFT. The payment of cash under NEFT is limited to a maximum of ??50,000 per transaction. To start NEFT in cash, you need to provide information such as your full address and phone number.

While there is no charge for those who receive the funds through NEFT, if you are transferring money you may have to pay a fee. For transactions up to ??10,000, banks can charge up to ??2.25; for the above transactions ??10,000 to ??1 lakh, up to ??4.75; for transactions between ??1 lakh and ??2 lakh, up to ??14.75; and for the above transactions ??2 lakh, up to ??24.75. All charges exclude GST. These are maximum rates set by the Reserve Bank of India (RBI), but banks are free to charge anything within the prescribed limits.

Typically, NEFT transactions are credited to the beneficiary’s account within two business hours. If the NEFT transaction is not credited or returned within the allotted time, then banks are required to pay penal interest at the RBI’s liquidity adjustment facility (LAF) repo rate (the interest rate to which the RBI lends to banks) plus 2% for the period of delay or until the date of repayment to the account of the customer concerned.

RTGS

This system is intended for high value transactions. The minimum amount you can transfer using RTGS is ??2 lakh, and there is no upper limit. RTGS is a system where the processing of instructions is done in real time, so the transfer is instantaneous. However, the RTGS service is only available on working days and during working hours.

Money transfer via RTGS can be initiated through mobile or internet banking or by visiting a bank branch. Transaction fees have been capped by RBI. You don’t have to pay any fees to receive money through RTGS, but to transfer funds between ??2 lakh and ??5 lakh, you may need to pay up to ??24h50, and ??49.50 for the transfer of a higher amount ??5 lakh. Fees exclude GST.

IMPS

This is a real-time payment service available 24 hours a day, including public holidays. This service is offered by National Payments Corp. of India, which allows customers to transfer money instantly through RBI authorized banks and prepaid payment instruments (PPIs) across India. Money transfer via IMPS can be initiated from mobiles, the internet or even an ATM. The fees for transfer via IMPS are decided by the individual banks and PPIs.

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