National Electronic Funds Transfer (NEFT) system is a nation wide funds transfer system to facilitate transfer of funds from any bank branch to any other bank branch.

No, As on December 16, 2008, around 52,347 branches of 89 banks are participating. Steps are being taken to widen the coverage both in terms of banks and branches.

No, there is no restriction of centers or of any geographical area inside the country. The system uses the concept of centralized accounting system and the bank's account that is sending or receiving the funds transfer instructions, gets operated only at one centre, viz, Mumbai. The individual branches participating in NEFT could be located anywhere across the country.

The beneficiary gets the credit on the same day or the next day depending on the time of settlement.

Step 1: The remitter fills in the NEFT Application form giving the particulars of the beneficiary (bank-branch, beneficiary's name, account type and account number) and authorizes the branch to remit the specified amount to the beneficiary by raising a debit to the remitter's account. (This can also be done by using net banking services offered by some of the banks.)
Step 2: The remitting branch prepares a Structured Financial Messaging Solution (SFMS) message and sends it to its Service Centre for NEFT.
Step 3: The Service Centre forwards the same to the local RBI (National Clearing Cell, Mumbai) to be included for the next available settlement. Presently, NEFT is settled in six batches at 0900, 1100, 1200, 1300, 1500 and 1700 hours on weekdays and 0900, 1100 and 1200 hours on Saturdays
Step 4: The RBI at the clearing centre sorts the transactions bank-wise and prepares accounting entries of net debit or credit for passing on to the banks participating in the system. Thereafter, bank-wise remittance messages are transmitted to banks.
Step 5: The receiving banks process the remittance messages received from RBI and effect the credit to the beneficiaries' accounts.

The RBI-EFT system is confined to the 15 centers where RBI is providing the facility, where as there is no such restriction in NEFT as it is based on the centralized concept. The detailed list of branches of various banks participating in NEFT system is available on our website. The system also uses the state-of-the-art technology for the communication, security etc, and thereby offers better customer service.

NEFT is an electronic payment system to transfer funds from any part of country to any other part of the country and works on Net settlement, unlike RTGS that works on gross settlement and EFT which is restricted to the fifteen centers only where RBI offices are located.

There is no value limit for individual transactions.

RBI publishes the list of bank branches participating in the NEFT on its website i.e. http://www.rbi.org.in/scripts/neft.aspx

Indian Financial System Code (IFSC) is an alpha numeric code designed to uniquely identify the bank-branches in India. This is 11 digit code with first 4 characters representing the banks code, the next character reserved as control character (Presently 0 appears in the fifth position) and remaining 6 characters to identify the branch. The MICR code has 9 digits to identify the bank-branch.

RBI had since advised all the banks to print IFSC on cheques leaves issued to their customers. You may also contact your bank-branch and get the IFS Code of that branch.

Primarily, NEFT is an account to account funds transfer system. Even customers not maintaining an account with an NEFT bank can remit funds up to Rs.50,000/- to the credit of another bank account.

Yes, NEFT is an account to account funds transfer system.

This system can be used only for remitting Indian Rupee among the participating banks within the country.

No.

No.

Yes, subject to applicability of provisions of FEMA.

Yes, the remitting customer gets back the money if it is not credited to the beneficiary account.

There are six settlements at 0900, 1100, 1200, 1300, 1500 and 1700 hours on weekdays and 0900, 1100 and 1200 hours on Saturdays.

The essential information that the remitting customer has to furnish is :
• Beneficiary details such as beneficiary name and account number
• Name and IFSC of the beneficiary bank branch.

The acronym "RTGS" stands for Real Time Gross Settlement. RTGS system is a funds transfer mechanism where transfer of money takes place from one bank to another on a "real time" and on "gross" basis. This is the fastest possible money transfer system through the banking channel. Settlement in "real time" means payment transaction is not subjected to any waiting period. The transactions are settled as soon as they are processed. "Gross settlement" means the transaction is settled on one to one basis without bunching with any other transaction. Considering that money transfer takes place in the books of the Reserve Bank of India, the payment is taken as final and irrevocable.

EFT and NEFT are electronic fund transfer modes that operate on a deferred net settlement (DNS) basis which settles transactions in batches. In DNS, the settlement takes place at a particular point of time. All transactions are held up till that time. For example, NEFT settlement takes place 6 times a day during the week days ( 9.00 am, 11.00 am, 12.00 noon, 1.00 pm, 3.00 pm and 5 pm) and 3 times during Saturdays ( 9.00 am, 11.00 am and 12.00 noon). Any transaction initiated after a designated settlement time would have to wait till the next designated settlement time. Contrary to this, in RTGS, transactions are processed continuously throughout the RTGS business hours.

The RTGS system is primarily for large value transactions. The minimum amount to be remitted through RTGS is Rs.1 Lakh. There is no upper ceiling for RTGS transactions. No minimum or maximum stipulation has been fixed for EFT and NEFT transactions.

Under normal circumstances the beneficiary branches are expected to receive the funds in real time as soon as funds are transferred by the remitting bank. The beneficiary bank has to credit the beneficiary's account within two hours of receiving the funds transfer message.

Yes. It is expected that the receiving bank will credit the account of the beneficiary instantly. If the money cannot be credited for any reason, the receiving bank would have to return the money to the remitting bank within 2 hours. Once the money is received back by the remitting bank, the original debit entry in the customer's account is reversed.

The remitting customer has to furnish the following information to a bank for effecting a RTGS remittance :
1. Amount to be remitted
2. Account number which is to be debited
3. Name of the beneficiary bank
4. Name of the beneficiary customer
5. Account number of the beneficiary customer
6. Sender to receiver information, if any
7. The IFSC code of the receiving branch

The beneficiary customer can obtain the IFSC code from his branch. The IFSC code is also available in the cheques leaf. This code number and bank branch details can be communicated by the beneficiary to the remitting customer.

For a funds transfer to go through RTGS, both the sending bank branch and the receiving bank branch would have to be RTGS enabled. The lists are readily available at all RTGS enabled branches. Besides, the information is available at RBI website (www.rbi.org.in/Scripts/Bs_viewRTGS.aspx). Considering that more than 52,216 branches at more than 5,000 cities/ towns and taluka places are covered under the RTGS system, getting this information would not be difficult.