Transferring funds from one account to another has always been the main concern for both individuals and businesses. Fund’s transfer is one of the important functions in the banking sector.
Earlier payee had to go to the bank to transfer their funds into the receiver's account.
Thanks to the recent technology that has provided us various options to transfer funds without going to the bank.
Today there are multiple fund transfer options provided by Reserve Bank of India (RBI). Among those NEFT or National Electronic Funds Transfer is one of the flexible online fund’s transfers options.
NEFT is an intra-bank online fund transfer facility. RBI introduced this online payment system in 2005. About 63000 banks in India provide NEFT facilities for their customers. RBI manages all the payment transactions done through NEFT.
This same day payment facility is said to be the fastest funds transfer system in India.
Key Features of NEFT
As per RBI guidelines, all the customers who have accounts in their respective banks can avail of the NEFT facility. NEFT transactions can be done within India only. Individuals and business bank account holders can avail of this facility.
Even walk-in customers who do not have a bank account can also perform NEFT transfer. Account-holders should check if their bank is connected with the NEFT network before availing of this facility. But today, nearly all banks provide NEFT facilities.
This online payment facility is available for 24 hours and for 365 days. There is no limit on transferring the number of funds through the NEFT facility. An account holder can transfer even a minimum amount or large amount from one account to another through this facility.
But generally, the amount above Rs. 2 Lakhs is transferred using the RTGS facility.
For payments up to Rs. 2 Lakhs NEFT is the best fund transfer facility to prefer. The time taken for this transfer is about 2 hours. In the case of cash-based remittance, there is an upper limit of Rs. 50000 for the NEFT transaction. Cash-based remittance transactions require full details of the payee and receiver.
All the details such as name, address, IFSC code, and other account details are filled in an NEFT form provided by the bank.
Recent updates on NEFT facility
From 16 December 2019, RBI has offered flexible guidelines for NEFT facilities to customers. Now customers can avail of this facility 24/7. NEFT is an online process that can be performed without going to the bank. RBI has extended NEFT timings.
Now customers can perform NEFT transactions from 8 am to 6:30 pm from Monday to Friday, and 8 am to 1 pm on Saturdays. From 1 January 2020, RBI has provided zero charges on fund transfer done through NEFT.
So you can perform small or large transactions through NEFT without paying any charges towards the bank. Customers with active internet banking can do NEFT transfer directly from their devices. The only thing is that they have to check with their banks for NEFT timings.
Procedure for doing Offline NEFT transfer
Procedure for doing Online NEFT transfer
NEFT transfer Timing
NEFT transfer is a fast way to transfer your funds into your beneficiary’s account. When you have done the procedure for NEFT transfer, a transaction ID will be generated. Your transaction ID will be in the queue.
Banks have their time slots for performing NEFT transactions. Based on their clearance timing, they will allocate your fund transfer. If you have done the NEFT transfer process in that time slot, your funds will be transferred during the same time slot.
Banks have their NEFT time slots on an hourly basis. The timing for NEFT transfer is 8 am to 6:00 pm from Monday to Friday, and 8 am to 1 pm on Saturday. Banks provide eight (8) batches of clearance slots in a day.
Once you initiate the NEFT transfer request, the bank will forward your request to the NEFT service center. The NEFT service center will initiate the fund transfer request to the NEFT clearing center.
The amount mentioned will be debited from your account. So generally, it will take about 1 to 2 hours to initiate your NEFT transaction.
If you do an online NEFT transaction on Sunday or a bank holiday, the bank will process your transaction for the next day's time slot. You will even get a notification from the bank regarding any delay in processing the NEFT transactions.
Due to recent Digital India promotion campaigns, banks have provided the NEFT facility for customers for all days. Straight Through Processing or STP is the mode used by banks for doing 24/7 NEFT transactions. So banks are providing seamless NEFT 24/7 facility for their customers.
Advantages of doing an NEFT Transaction
Customers often face some issues or doubts while performing their first NEFT transactions. It is because they are generally not aware of the NEFT transaction process. So let’s know about such issues and questions which can arise while performing the first NEFT transaction.
Hence NEFT facility helps a lot in case of performing a quick transfer of funds from one bank account to another.