NEFT vs. RTGS: What's the Difference?
Edited by Huma Saeed || By Sumera Saeed || Updated on October 17, 2023
NEFT (National Electronic Funds Transfer) is an electronic funds transfer system in India for batch settlements, while RTGS (Real-Time Gross Settlement) enables real-time large-value interbank transactions.
Key Differences
NEFT, or National Electronic Funds Transfer, is an electronic system used in India to transfer funds between banks. This system operates in batches and is not real-time. Conversely, RTGS, which stands for Real-Time Gross Settlement, is another funds transfer system that operates in real-time and is primarily designed for large-value transactions.
Sumera Saeed
Oct 17, 2023
When utilizing NEFT, transactions are processed in hourly batches, meaning that there can be a delay in funds reaching the recipient's bank. On the flip side, RTGS transactions are processed instantly, ensuring that the recipient receives the transferred amount in real-time, provided the transaction is conducted within the operational hours.
Sumera Saeed
Oct 17, 2023
From a monetary perspective, NEFT doesn't usually have a minimum transfer limit, making it suitable for small transfers. RTGS, due to its real-time nature, generally has a minimum transaction limit, positioning it as a preferable option for transferring substantial amounts of money.
Sumera Saeed
Oct 17, 2023
In terms of accessibility, both NEFT and RTGS are widely available across banks in India. However, it's crucial to note that while NEFT can be used for all account types, including savings, current, and cash credit, RTGS is mainly reserved for current account holders in many banks.
Sumera Saeed
Oct 17, 2023
The charges associated with NEFT and RTGS transactions can vary. Typically, NEFT charges are lower due to its batch processing nature. In contrast, RTGS, being a real-time service, can come with a higher fee, especially for high-value transactions.
Sumera Saeed
Oct 17, 2023
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Comparison Chart
Minimum Transfer Limit
Usually no minimum limit
Has a minimum limit (e.g., 2 lakhs in India)
Sumera Saeed
Oct 17, 2023
Usage
Suitable for small to medium transfers
Primarily for large-value transactions
Sumera Saeed
Oct 17, 2023
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NEFT and RTGS Definitions
NEFT
A widely accessible banking transfer method in India operating in fixed time slots.
I missed the 10 am NEFT batch, so my transfer will be processed in the next one.
Harlon Moss
Oct 17, 2023
RTGS
A real-time interbank transfer system for high-value transactions.
For a 5 million rupee transfer, I'd use RTGS.
Huma Saeed
Oct 17, 2023
NEFT
A digital payment system allowing transfer without any minimum limit.
Even for transferring just 500 rupees, I can use NEFT.
Sumera Saeed
Oct 17, 2023
RTGS
An electronic fund transfer mechanism that operates instantly.
The advantage of RTGS is the immediate settlement.
Sumera Saeed
Oct 17, 2023
NEFT
A mode of interbank transfer for smaller and medium-sized transactions.
For small amounts, NEFT is more cost-effective.
Huma Saeed
Oct 17, 2023
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RTGS
A secure and fast method for transferring large sums between banks.
For urgent, high-value transactions, RTGS is the go-to.
Sumera Saeed
Oct 17, 2023
NEFT
An electronic fund transfer system in India operating in hourly batches.
I sent money using NEFT and it got credited in the next batch.
Sumera Saeed
Oct 17, 2023
RTGS
An Indian banking solution primarily for substantial financial transfers.
Businesses often prefer RTGS for bulk transactions.
Sumera Saeed
Oct 17, 2023
NEFT
An Indian banking system for electronic monetary transfers.
Using NEFT, I can send money to any bank account in India.
Sumera Saeed
Oct 17, 2023
RTGS
A digital transfer system requiring a minimum amount for transactions.
I couldn't use RTGS as my transfer amount was below the threshold.
Aimie Carlson
Oct 17, 2023
FAQs
What's the primary purpose of RTGS?
RTGS is primarily for instant, high-value interbank transfers.
Sara Rehman
Oct 17, 2023
How is RTGS different from NEFT?
RTGS is a real-time transfer system for large amounts, while NEFT operates in hourly batches for any amount.
Huma Saeed
Oct 17, 2023
Can I use NEFT for any bank in India?
Yes, NEFT is accessible across all major banks in India.
Sumera Saeed
Oct 17, 2023
What does NEFT stand for?
NEFT stands for National Electronic Funds Transfer.
Sumera Saeed
Oct 17, 2023
Is there a minimum amount for NEFT transactions?
Usually, there's no minimum amount for NEFT transactions.
Sumera Saeed
Oct 17, 2023
What information is needed for a NEFT transfer?
For NEFT, you typically need the recipient's name, bank details, account number, and IFSC code.
Sumera Saeed
Oct 17, 2023
Can I cancel an RTGS transaction once initiated?
Once an RTGS transaction is processed, it's final and typically cannot be canceled.
Sara Rehman
Oct 17, 2023
Can I use RTGS for international transfers?
No, RTGS is for domestic interbank transactions within India.
Sumera Saeed
Oct 17, 2023
Are there any disadvantages to using NEFT?
NEFT operates in batches, so it might not be as fast as real-time systems like RTGS.
Harlon Moss
Oct 17, 2023
Can I schedule future-dated NEFT transactions?
Yes, many banks allow you to schedule NEFT transactions for future dates.
Sara Rehman
Oct 17, 2023
Why would someone choose NEFT over RTGS?
NEFT is often chosen for smaller amounts due to lower fees and no minimum limit.
Sara Rehman
Oct 17, 2023
How long does a NEFT transfer take?
NEFT transfers are processed in hourly batches, so the time can vary.
Sumera Saeed
Oct 17, 2023
Can businesses use RTGS for their transactions?
Absolutely, businesses often use RTGS for high-value transactions.
Sumera Saeed
Oct 17, 2023
Is there a maximum limit for RTGS transactions?
There's no maximum limit for RTGS, but there's a minimum limit, often set by the bank.
Sumera Saeed
Oct 17, 2023
Is RTGS available 24/7?
As of my last update in 2022, RTGS in India operates 24/7.
Aimie Carlson
Oct 17, 2023
Are there charges for using NEFT or RTGS?
Yes, banks typically charge a fee for both NEFT and RTGS, but the rates can vary.
Janet White
Oct 17, 2023
Can individuals use RTGS?
Yes, individuals can use RTGS for transferring large amounts.
Aimie Carlson
Oct 17, 2023
How do I know if a bank offers NEFT or RTGS services?
Most major banks in India offer both NEFT and RTGS services. It's best to check with the specific bank.
Sara Rehman
Oct 17, 2023
Which is faster, NEFT or RTGS?
RTGS is faster as it's real-time, whereas NEFT works in batches.
Aimie Carlson
Oct 17, 2023
About Author
Written by
Sumera SaeedSumera is an experienced content writer and editor with a niche in comparative analysis. At Diffeence Wiki, she crafts clear and unbiased comparisons to guide readers in making informed decisions. With a dedication to thorough research and quality, Sumera's work stands out in the digital realm. Off the clock, she enjoys reading and exploring diverse cultures.
Edited by
Huma SaeedHuma is a renowned researcher acclaimed for her innovative work in Difference Wiki. Her dedication has led to key breakthroughs, establishing her prominence in academia. Her contributions continually inspire and guide her field.
