After demonetization by the Modi government, the number of online transactions has increased. Keeping too much cash on you is very inconvenient and not to mention unsafe. The Banks have thus established many payment methods for online transfer of funds, which are accessible to one and all and easy to use.
NEFT Full Form
The full form of NEFT is the National Electronic Funds Transfer.
What is NEFT?
The technology of NEFT was created in November 2005 by the Institute of Development and Research in Banking Technology. It enables the banker to transfer funds online to another bank user with NEFT enabled account.
When can you transfer funds?
The payment method transfers funds only during the working days I.e; public holidays, 2nd and 4th Saturdays and all Sundays are off, and fund are not transferred during this time.
The funds are not transferred immediately. They are transferred in 23 sessions in a day from 8 am to 7 pm (once every half hour) during the day. Any transactions made outside this time frame are handled the day/ session.
Maximum and minimum limit of transaction possible through NEFT
No limits on the maximum or minimum transactions have been set by the RBI. However, most private banks have their own limits to transacting funs. The minimum limit is, however, Rs 1 for all. Here is a list of some of the most famous banks with their maximum transaction limits:
- ICICI bank– up to Rs 10 lakhs per transaction
- HDFC bank– up to Rs 2.5 lakhs per transaction
- Axis bank– no limit
- Kotak– up to Rs 50,000 per day
- SBI– up to Rs 10 lakhs
Service Charges for Transactions
Since 2013, the fee has wavered for NEFT payments made online like through Net banking, Mobile banking, etc.
- For transactions upto Rs 10,000- Rs 2.25+ GST
- For transactions above Rs 10,000 and below 1 lakh- Rs 4.75+ GST
- For transactions above 1 lakh and below 2 lakh- Rs 14.75+ GST
- For transactions above 2 lakhs and upto 10 lakhs- Rs 24.75+ GST
- Upto Rs 1 lakh- Rs 2+ GST
- Above Rs 1 lakh- Rs 10 +GST
- No charges
- Up to Rs 10000: Rs 2
- Above Rs 10001 and up to Rs 100000- Rs 4
- Above 100001 and up to Rs 200000- Rs 14
- Above Rs 200000- Rs24.
- Up to Rs 10,000- Rs 2.50 + GST
- Above Rs 10,000 and up to Rs 1 lakh- Rs 5 + GST
- Above Rs 1 lakh up to Rs 2 Lakh- Rs 15 + GST
- Above Rs 2 lakh- Rs 25 + GST
Process to use NEFT online
- Make sure the beneficiary account has NEFT enabled.
- Go to the official site of the bank in which your, and the beneficiary’s account is made.
- Click on the net banking option.
- Log in to the site using the given username and password.
- Click on the ADD option and add the beneficiary account details- beneficiary name, beneficiary account number, address
- Then add the IFSC code of the beneficiary account. It speaks of the location of the beneficiary bank branch. Either do so by providing the location or select from the drop-down menu or do it manually.
- Accept the terms and conditions and confirm the details.
- You will receive a security message with a pin on the registered mobile number for additional security reasons.
- Once you put in the pin code, the transaction is over.
- For Interbank transactions, click on the interbank online transfers options and follow the same procedure.
The process to use NEFT offline ( at the bank Branch)
- Go to the bank branch.
- Take an NEFT form and fill in the required details asked on the form
- Hand it over to the bank official. The rest of the procedure is the same carried out by the official.
- NEFT is safe, efficient and quick
- Alleviates the need for carrying around a lot of cash.
- Reduces the scope of corruption
- Online transactions are free of cost
- Removes the need to stand in long lines to transfer funds
- Funds can be transferred over a long distance
- Funds can be transferred within a day
- No minimum transaction limits
- Is subject to hacker risk
- Processing charges
- Limit to transactions in many private banks
- Human error is a possibility while entering bank details since the process is highly technical
- May not reach the more remote parts of the country since it requires an internet connection.
National Electronic Funds Transfer(NEFT) is an electronic fund transfer process which is used to send funds from one bank to another.
RTGS is a faster payment process. Transfer through RTGS takes 10 min to 2 hrs time. NEFT takes up to 24 hrs.
RTGS generally has a minimum amount of capping, depending on the bank. Generally, it is Rs 1 lac or Rs 2 lacs. NEFT has maximum amount capping which is again around Rs 1 lac or Rs 2 lacs, depending on the bank.
NEFT takes up to 24 hrs to transfer funds.
The NEFT transfer though it may take time, and is not like credit happens in real-time, is one of the safest