Many of you must have used NEFT before to send money but do you have the right information about what is NEFT? Because the rules of the bank keep changing day by day, it is very important to have updated information on all these subjects.
Ever since online banking or internet banking has come, people’s going to banks has ended in a way, now they do all their work sitting at home. Due to this, there is not much loss of their time and they work easily.
There are three main ways to transfer funds online which are NEFT, RTGS, and IMPS. Out of these, today we will get detailed information about NEFT. So if we talk about NEFT, then it is such a medium to send money online, through which we can easily send or get money online from one account to another.
So that’s why today I thought that why you people will also get complete information about what is NEFT, how it works, and what are its benefits it. Then without delay let’s start and know about what is NEFT.
What is NEFT
The full form of NEFT is National Electronic Fund Transfer or is also called ” National Electronic Fund Transfer ” in Hindi. It is a nationwide electronic fund transfer system that allows money to be sent or received easily and securely from one bank account to another.
All NEFT settlements are handled in batch-wise format. In this, money is sent through this system to all NEFT-enabled banks across India on an individual basis.
Before starting any NEFT transfer, it is very important to have the IFSC Code of the bank along with other details like bank account number, bank branch, account holder name.
The system of this fund transfer is operated by RBI. Which started in the year 2005. NEFT provides this facility to the customers of the bank in India so that the customer of the bank can very easily transfer his capital to any other NEFT-enabled bank account. It is also very safe.
Fund transfer through the NEFT system is not on a real-time basis but in half-hour batches with 23 settlements taking place from 8:00 AM to 7:30 PM on 1st, 3rd, and 5th Saturdays of NEFT week ( batch) the transfer of money is decided.Apart from this, there is no settlement on the second and fourth Saturdays of the month, on Sundays, or even on public holidays.
The facility of NEFT is mainly done in two types, one is an offline mode which is done in the branches of banks and the other is online mode which is available to the customers through online banking and is done in batches.
It is very popular due to the time-saving and easy process that NEFT brings, as transactions can be done very easily through online banking. If seen, NEFT is slightly different from other measures like RTGS and IMPS. Where your money sent in RTGS and IMPS is immediately credited to the front bank account. Whereas in NEFT, your money is received by the bank in the timetable set by the bank.
Step By Step NEFT Transfer Procedure
Here I will provide you people with information about two different procedures of NEFT.
Online Procedure for NEFT:
Follow the steps given below to transfer funds through online
Step 1: First of all login into your net banking account. If you do not have a net banking account, then you can also register it through your bank’s website.
Step 2: After that, you have to add the beneficiary according to the payee. Here beneficiary means that to whom you want to transfer money. And to do this, you will also have to fill in some details of the Beneficiary in the ‘Add New Payee’ section, which are:
Step 3: Once the payee is added, after that you have to choose NEFT according to the fund transfer mode.
Step 4: Now you have to select the account where you want to transfer money, here you have to select payee, after that enter the amount you want to transfer and then add remarks (optional).
Step 5: Then click on submit.
Offline Procedure for NEFT:
Step 1: First of all go to the bank.
Step 2: Fill there NEFT/RTGS form. After that provide the following details about your beneficiary in that form:
Amount as much as you have to transfer.
Step 3: After that submit your filled form so that they can further authorize to transfer of money.
How does NEFT work?
Here I have tried to explain to you the generic process of NEFT transfer, but these nuances may vary in different banks, yet the process is almost the same.
1. As I have already told you how you have to fill the form in detail through online or offline mode, you have to provide complete information about the beneficiary. With this, how do banks authorize it and process it further?
2. After this your bank issues a message and then sends it to their NEFT Service Center.
3. NEFT forwards this message from your bank to NEFT Clearing Center which is operated by National Clearing Cell and with it, it is a part of Reserve Bank of India in Mumbai and it includes it next available In the branch of transaction.
4. After this, the NEFT Clearing Center sorts all the funds transfer transactions according to its banks and decorates those entries in such a way that the banks on which your money has to go are sorted very easily. NEFT Service Center then receives messages where they get all the entries sorted, along with they also get messages about money from NEFT Clearing Center, where they are instructed to send funds to the receiver’s account.
NEFT Transfer Fees & Charges
The point to be noted here is that the recipient bank does not charge you any fees for NEFT transactions. But for a sender, the sending bank charges them for NEFT Transaction. You will get the information below about how much they charge.
Amounts Rs 10000
Rs 2.50 + Applicable GST
Amounts above Rs 10000 and up to Rs 1 lakh
Rs 5 + Applicable GST
Amounts above Rs 1 lakh and up to Rs 2 lakh
Rs 15 + Applicable GST
Amounts above Rs 2 lakh and up to Rs 5 lakh
Rs 25 + Applicable GST
Amounts above Rs 5 lakh and up to Rs 10 lakh
Rs 25 + Applicable GST
Note:- These charges change from time to time. Therefore, before sending NEFT, consult your bank.
NEFT Transactions Timings:
As of now, NEFT works in hourly batches, so it works between the service center’s operational hours (8:00 AM to 7:00 PM on normal weekdays and 8 AM to 1 PM Saturdays) In).
With this, there are 8 to 6 batches to work one after the other. That’s why money is transferred from Monday to Saturday (except the 2nd and 4th Saturdays of the month) from 8:00 AM to 6:30 PM. Apart from this, work is not done even in NEFT transactions public and bank holidays.
Public Holidays when NEFT Transactions cannot be completed are Republic Day, Good Friday, Annual Closing of Banks, RBI’s Annual Closing of Accounts, Ramzan Id (Id-ul-Fitr)/Ratha Yatra, Independence Day, Dasara / Vijaya Dashami, and Muharram.
Who can transfer funds through NEFT?
Any firm, the individual, corporation can use NEFT to transfer funds from one bank account to another bank account, but the thing to note is that they should have a bank account in that bank branch and NEFT in that bank branch. The facility should also be Enable/Available.
Apart from this, also know that you don’t need to have a bank account. Even if someone does not have a bank account in a bank branch and even then if he wants to transfer funds through NEFT, then fund transfer can be done by filling the NEFT instruction slip. But to transfer funds in this way through NEFT, only a maximum amount of up to Rs 50,0000 can be transferred in a transaction.
Who can receive funds through NEFT?
If this work is done by an Individual, Firm, Corporation that has a bank account in their bank branch, then all of them can receive the funds sent by NEFT. But for this, the Beneficiary Customer must have a bank account in that bank branch in which NEFT Facility is Enabled/Available.
What are the benefits of NEFT?
Now let us know about the benefits of NEFT:-
Through NEFT, any firm, individual, corporation, etc. can easily send money from one account to another.
Here the Beneficiary Customer (to whom the money is sent) does not need to go to the bank branch to receive the fund, nor does he have to do any kind of paper formalities.
Fees in NEFT are very few.
Fund transfer can be done from anywhere, anytime using Internet Banking. They are very safe and secure. And if for some reason your transaction is not completed, then you do not need to panic because in this case your money is not lost anywhere, but also comes back to the sent account.
It is more useful for Low-Value Transactions.
Here the receiver does not have to pay any additional cost.
Here each batch is for one hour.
What is NEFT?
The full form of NEFT is National Electronic Funds Transfer, which is an electronic fund transfer process, through which money can be easily sent from one bank account to another bank account.
Is having an IFSC code mandatory for all NEFT transactions?
the answer is yes. It is very important to have an IFSC code for any NEFT transaction.
Do all banks have an NEFT facility?
No. the NEFT facility is not available on all banks.
How will a customer know whether his bank or payee’s bank is part of NEFT or not?
You can get all this information from which banks are NEFT-enabled, from the website of the Reserve Bank of India (RBI).
How long does it take for NEFT transactions to be settled?
All fund transfer transactions are processed in batch-wise format and the money is credited within 2 working days.
I have full hope that I have given you complete information about what is NEFT and I hope you have understood NEFT. I request all of you readers that you also share this information in your neighborhood, relatives, your friends so that there will be awareness among us and everyone will benefit a lot from it. I need your cooperation so that I can pass on more new information to you guys.
It has always been my endeavor that I should always help my readers or readers from all sides, if you people have any doubts of any kind, then you can feel free to ask me.
I will definitely try to solve those doubts. You read this article What is NEFT? And how does this work? How did you feel, do tell us by writing a comment so that we too get a chance to learn something from your thoughts and improve something?