Finance

Why using the NEFT service will benefit you for fast transfers

National electronic funds transfer (NEFT) is a popular method of transferring funds online all across the country. Through this system of payment an individual can transfer a sum of money from one bank to another individual who has an account in another bank under the same scheme.

All one needs in order to do an NEFT is- internet connection and a net banking account. Banks generally charge a very small amount during an NEFT, but even so it is still a comparatively cheaper option than a RTGS transfer (Real Time Gross Settlement).

The charge for a NEFT transaction generally differs from one bank to another. But a bank cannot charge more than 30Rs for transactions up to 2-5 lakhs and more than 55Rs for transactions higher than 5 lakhs.

How is NEFT done and who can avail this service?

While a NEFT transfer can be quite conveniently done via internet banking, one may also initiate a transfer through the branch directly.

If one has a savings account or a current account at a bank, they can avail the NEFT service. Any sum of money can be transferred through NEFT, but there are some banks that do have a limit.

Those who do not have an account are also allowed to make a cash deposit at any bank that allows NEFT. But in this case only a certain amount and not above that may be transferred.

Speed of transaction through NEFT

Although NEFT is quite a convenient way to transfer money, earlier the transaction process did take some time to complete. This is why many individuals opted for other transfer methods in case of an emergency transaction.

But this year, the Reserve Bank of India (RBI) is all set to make this transaction system faster and better. Fund transfers will now be done in half hour intervals. Before they were undertaken every hour.

The settlement cycle has now been increased to 23. Previously it was 12. When one makes a bank transaction, a clearance request is forwarded to the RBI, and the RBI processes it in the following settlement cycle. Therefore, as the cycles will increase this will facilitate faster transfers.

The settlement time will being at 8 am in the morning and end about 7 pm in the evening. With the introduction of 11 more settlement batches, the RBI strives to make customer service more efficient and increase the speed of the entire NEFT process.

One should thus opt for NEFT, in order to carry out transactions and payments. With the new updates that RBI is brining into play, a NEFT transaction well be quite fast and efficient.

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