Difference
Between RTGS and NEFT – Banking Awareness Notes
Dear Aspirants,
Welcome to Mentor for Bank Exams. Here we are
presenting you the other most important concept on Difference Between RTGS and
NEFT. The objectives, working, and examples are given below:
What is NEFT?
It is National Electronic
Fund Transfer.
Objective
Its main purpose is to
enable electronic cash transfer having accounts in bank branches.
It is used for transferring funds from one financial institution to another within India especially banks. IT was launched in November 2005, and was assigned to every bank. It was made mandatory by the RBI for all banks to migrate to NEFT.
It is used for transferring funds from one financial institution to another within India especially banks. IT was launched in November 2005, and was assigned to every bank. It was made mandatory by the RBI for all banks to migrate to NEFT.
No minimum and maximum
limit for cash remittance.
Working
Step 1: Remitting bank requests for NEFT.
Step 2: Request is registered by NEFT
servers.
Step 3: Request is cleared on the basis
of the input.
RBI servers bunches up
all the NEFT requests and clears it in hourly batches.
Example
Suppose you have an
account in Citi bank and you want to transfer 1,50,000 Rs to SBI customer and
your bank has registered your NEFT service at 12:30 pm. Instantly it will be
queued in slot of 12:00 pm to 1:00 pm and at 1:00 pm all the requests will be
cleared. So, effectively your transaction will be cleared after 30 minutes of
registration.
What is RTGS?
It is Real Time Gross
Settlement.
Objective
Its main purpose is to enable
electronic cash transfer having accounts in bank branches.
It is a fund transfer system which is moved from one ban to another in real time and on gross basis.
It is a fund transfer system which is moved from one ban to another in real time and on gross basis.
It means that the payment
transaction isn’t subject to any waiting period. The transaction will be
completed as soon as the processing is done, and gross settlement means that
the money transfer is completed on a one to one basis without clustering with
another transaction.
The transaction is
treated as final and irrevocable as the money transfer occurs in the books of
the RBI. This system is maintained by the RBI, and it is available only during
working days for a given number of hours.
The minimum limit is
2,00,000 Rs and there is no maximum limit.
Example
If you have registered
for RTGS transaction through your bank branch it will be settled instantly in
real time basis. Real time means that your money will be credited within
minutes in the beneficiary account.
Differences between NEFT and RTGS:
