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NEFT – National Electronic Funds Transfer

blog-image
Jun 15, 2024
5 Minutes

National Electronic Funds Transfer (NEFT) is a nationwide payment system that allows the transfer of funds from one bank account to another. With the rise of online banking, NEFT has become a popular method for transferring funds electronically, eliminating the need for visiting a bank branch.

How NEFT Transactions Are Processed

NEFT transactions are processed in batches rather than instantaneously. Here are the steps involved:

Filling Out the Form: The individual initiating the transfer must fill out an application form with the beneficiary's details, including the beneficiary's name, the bank's branch name where the beneficiary holds an account, the IFSC of the branch, the account type, and the account number.

Data Collection: The originating bank collects the data and sends a message to the NEFT service center.

Message Forwarding: The NEFT service center forwards the message to the NEFT clearing center to be included in the next available batch.

Sorting Transactions: The clearing center sorts the fund transfer transactions by destination bank and prepares the account entries to receive funds from the originating bank and route them to the beneficiary’s bank.

Fund Transfer: The destination bank receives the inward remittance messages from the clearing center and credits the beneficiary’s account.

NEFT Timings

NEFT transactions are available 24x7, 365 days a year. Previously, NEFT was only available from 8:00 AM to 6:30 PM, Monday to Friday. The Reserve Bank of India (RBI) has now regularized NEFT transactions to be available every day, including holidays. After regular banking hours, NEFT transactions are automated using 'Straight Through Processing' (STP) modes.

How to Transfer Funds through NEFT Online

To transfer funds through NEFT online, follow these steps:

Log in: Access your net banking account.

Fund Transfer Option: Select 'Fund transfer' from the main menu.

Choose NEFT: From the drop-down menu, select 'NEFT.'

Add Beneficiary: If the beneficiary is not already added, click 'Add beneficiary.'

Enter Details: Provide the beneficiary’s name, account number, IFSC, etc., and confirm.

Authentication: An OTP will be sent to your registered mobile number for authentication.

Processing Time: It may take up to 24 hours to add the beneficiary.

Initiate Transfer: Select the beneficiary, enter the amount, and confirm the transaction.

How to Transfer Funds through NEFT Offline

For offline NEFT transactions, you need to fill out an NEFT form at your bank’s branch:

Provide Details: Fill in your details along with the beneficiary’s details, including account number, account name, IFSC Code, branch name, and bank name.

Submit Form: Submit the form to the banking official.

PAN Requirement: For transactions exceeding Rs. 50,000, provide your PAN card.

Major Banks Providing NEFT Facility

Numerous banks in India offer NEFT services, including but not limited to:

Axis Bank

Bank of Baroda

HDFC Bank

ICICI Bank

State Bank of India

Yes Bank

How to Track NEFT Transaction Status

To track your NEFT transaction status:

Contact CFC: Reach out to the NEFT Customer Facilitation Centre (CFC) of your bank.

Provide Details: Give details such as the Unique Transaction Reference (UTR) number and the date of the transaction.

Find CFC Details: CFC details can be found on your bank’s website.

Who Can Make NEFT Transactions

Both account holders and non-account holders can use NEFT. Non-account holders can deposit cash at an NEFT branch of any bank, providing details like address and phone number. Note that non-account holders are limited to transactions of up to Rs. 50,000 per transaction.

NEFT Transfer Limit

There is no transfer limit set by the RBI for NEFT. However, individual banks may impose limits based on their risk assessment.

Prerequisites for NEFT Transfer

To use NEFT, the following prerequisites must be met:

Bank Account: A savings or current account is needed.

Non-Account Holders: Can use NEFT by visiting an NEFT-enabled bank branch.

Transaction Limit: Non-account holders can transfer up to Rs. 50,000 per transaction.

Online Banking: NEFT can be done online via net banking or mobile banking.

Essential Beneficiary Details Required for NEFT Transfer

You need the following details to transfer funds via NEFT:

Beneficiary’s Name

Branch Name

Bank Name

Account Type

Account Number

Branch IFSC Code

Chances of Failure of NEFT Transfers

NEFT transfers may fail due to technical glitches, especially during heavy payment loads. In case of failure, the deducted amount is usually refunded. If you do not receive the refund within three days, contact your bank’s customer care team.

Charges Applicable for NEFT Transactions

Receiving funds via NEFT is free. However, charges apply when initiating transfers:

Up to Rs. 10,000: Rs. 2.50 (+ GST)

Rs. 10,000 to Rs. 1 Lakh: Rs. 5 (+ GST)

Rs. 1 Lakh to Rs. 2 Lakh: Rs. 15 (+ GST)

Above Rs. 2 Lakh: Rs. 25 (+ GST)

Charges vary by bank, and it’s advisable to check with your bank for specific fees.

Benefits of Using NEFT

NEFT offers several advantages:

Availability: 24x7, 365 days a year.

Security: Safe and secure fund transfers.

No RBI Charges: No charges from RBI for banks.

Versatility: Can be used for various transactions like credit card payments and loan EMIs.

Pan-India Service: Available across India.

No Online Charges: No charges for online transactions for savings bank customers.

Convenience: Can be initiated from home via net banking or mobile banking.

Confirmation: Remitter receives confirmation via SMS or email.

Cost-Effective: Economical mode of fund transfer.

Differences Between NEFT, UPI, and RTGS

Here’s a detailed comparison between NEFT, UPI, and RTGS:

NEFT: Minimum transfer value is Rs. 1, with no maximum limit. It supports both online and offline payments and takes up to 30 minutes for transfers. Available 24x7, with no charges for inward transactions. Beneficiary registration is required, and you need the account number and IFSC code.

UPI: Minimum transfer value is Rs. 1, with a maximum limit of Rs. 2 lakh. It’s an online-only service with immediate transfer time. Available 24x7, with no charges for inward transactions. No beneficiary registration is required, and you need the VPA, QR code, or account number and IFSC code.

RTGS: Minimum transfer value is Rs. 2 lakh, with no maximum limit. It supports both online and offline payments and offers immediate transfers. Available 24x7, with no charges for inward transactions. Beneficiary registration is required, and you need the account number and IFSC code.

In conclusion, NEFT is a reliable, secure, and cost-effective method for transferring funds electronically across India. Its availability around the clock and ease of use make it a preferred choice for many banking customers.

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Team Pluto
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Want to Achieve any of the below Goals upto 80% faster?Trusted by 3 Crore+ Indians
Dream Home
Dream Wedding
Dream Car
Retirement
1st Crore
credit-cards

NEFT – National Electronic Funds Transfer

blog-image
Jun 15, 2024
5 Minutes

National Electronic Funds Transfer (NEFT) is a nationwide payment system that allows the transfer of funds from one bank account to another. With the rise of online banking, NEFT has become a popular method for transferring funds electronically, eliminating the need for visiting a bank branch.

How NEFT Transactions Are Processed

NEFT transactions are processed in batches rather than instantaneously. Here are the steps involved:

Filling Out the Form: The individual initiating the transfer must fill out an application form with the beneficiary's details, including the beneficiary's name, the bank's branch name where the beneficiary holds an account, the IFSC of the branch, the account type, and the account number.

Data Collection: The originating bank collects the data and sends a message to the NEFT service center.

Message Forwarding: The NEFT service center forwards the message to the NEFT clearing center to be included in the next available batch.

Sorting Transactions: The clearing center sorts the fund transfer transactions by destination bank and prepares the account entries to receive funds from the originating bank and route them to the beneficiary’s bank.

Fund Transfer: The destination bank receives the inward remittance messages from the clearing center and credits the beneficiary’s account.

NEFT Timings

NEFT transactions are available 24x7, 365 days a year. Previously, NEFT was only available from 8:00 AM to 6:30 PM, Monday to Friday. The Reserve Bank of India (RBI) has now regularized NEFT transactions to be available every day, including holidays. After regular banking hours, NEFT transactions are automated using 'Straight Through Processing' (STP) modes.

How to Transfer Funds through NEFT Online

To transfer funds through NEFT online, follow these steps:

Log in: Access your net banking account.

Fund Transfer Option: Select 'Fund transfer' from the main menu.

Choose NEFT: From the drop-down menu, select 'NEFT.'

Add Beneficiary: If the beneficiary is not already added, click 'Add beneficiary.'

Enter Details: Provide the beneficiary’s name, account number, IFSC, etc., and confirm.

Authentication: An OTP will be sent to your registered mobile number for authentication.

Processing Time: It may take up to 24 hours to add the beneficiary.

Initiate Transfer: Select the beneficiary, enter the amount, and confirm the transaction.

How to Transfer Funds through NEFT Offline

For offline NEFT transactions, you need to fill out an NEFT form at your bank’s branch:

Provide Details: Fill in your details along with the beneficiary’s details, including account number, account name, IFSC Code, branch name, and bank name.

Submit Form: Submit the form to the banking official.

PAN Requirement: For transactions exceeding Rs. 50,000, provide your PAN card.

Major Banks Providing NEFT Facility

Numerous banks in India offer NEFT services, including but not limited to:

Axis Bank

Bank of Baroda

HDFC Bank

ICICI Bank

State Bank of India

Yes Bank

How to Track NEFT Transaction Status

To track your NEFT transaction status:

Contact CFC: Reach out to the NEFT Customer Facilitation Centre (CFC) of your bank.

Provide Details: Give details such as the Unique Transaction Reference (UTR) number and the date of the transaction.

Find CFC Details: CFC details can be found on your bank’s website.

Who Can Make NEFT Transactions

Both account holders and non-account holders can use NEFT. Non-account holders can deposit cash at an NEFT branch of any bank, providing details like address and phone number. Note that non-account holders are limited to transactions of up to Rs. 50,000 per transaction.

NEFT Transfer Limit

There is no transfer limit set by the RBI for NEFT. However, individual banks may impose limits based on their risk assessment.

Prerequisites for NEFT Transfer

To use NEFT, the following prerequisites must be met:

Bank Account: A savings or current account is needed.

Non-Account Holders: Can use NEFT by visiting an NEFT-enabled bank branch.

Transaction Limit: Non-account holders can transfer up to Rs. 50,000 per transaction.

Online Banking: NEFT can be done online via net banking or mobile banking.

Essential Beneficiary Details Required for NEFT Transfer

You need the following details to transfer funds via NEFT:

Beneficiary’s Name

Branch Name

Bank Name

Account Type

Account Number

Branch IFSC Code

Chances of Failure of NEFT Transfers

NEFT transfers may fail due to technical glitches, especially during heavy payment loads. In case of failure, the deducted amount is usually refunded. If you do not receive the refund within three days, contact your bank’s customer care team.

Charges Applicable for NEFT Transactions

Receiving funds via NEFT is free. However, charges apply when initiating transfers:

Up to Rs. 10,000: Rs. 2.50 (+ GST)

Rs. 10,000 to Rs. 1 Lakh: Rs. 5 (+ GST)

Rs. 1 Lakh to Rs. 2 Lakh: Rs. 15 (+ GST)

Above Rs. 2 Lakh: Rs. 25 (+ GST)

Charges vary by bank, and it’s advisable to check with your bank for specific fees.

Benefits of Using NEFT

NEFT offers several advantages:

Availability: 24x7, 365 days a year.

Security: Safe and secure fund transfers.

No RBI Charges: No charges from RBI for banks.

Versatility: Can be used for various transactions like credit card payments and loan EMIs.

Pan-India Service: Available across India.

No Online Charges: No charges for online transactions for savings bank customers.

Convenience: Can be initiated from home via net banking or mobile banking.

Confirmation: Remitter receives confirmation via SMS or email.

Cost-Effective: Economical mode of fund transfer.

Differences Between NEFT, UPI, and RTGS

Here’s a detailed comparison between NEFT, UPI, and RTGS:

NEFT: Minimum transfer value is Rs. 1, with no maximum limit. It supports both online and offline payments and takes up to 30 minutes for transfers. Available 24x7, with no charges for inward transactions. Beneficiary registration is required, and you need the account number and IFSC code.

UPI: Minimum transfer value is Rs. 1, with a maximum limit of Rs. 2 lakh. It’s an online-only service with immediate transfer time. Available 24x7, with no charges for inward transactions. No beneficiary registration is required, and you need the VPA, QR code, or account number and IFSC code.

RTGS: Minimum transfer value is Rs. 2 lakh, with no maximum limit. It supports both online and offline payments and offers immediate transfers. Available 24x7, with no charges for inward transactions. Beneficiary registration is required, and you need the account number and IFSC code.

In conclusion, NEFT is a reliable, secure, and cost-effective method for transferring funds electronically across India. Its availability around the clock and ease of use make it a preferred choice for many banking customers.

Available on both IOS and AndroidTry Pluto Money Today 👇
Author
Team Pluto
Have a question?
Digital GoldInvest in 24K Gold with Zero making ChargesLearn More
Digital SilverInvest in silver with Zero making ChargesLearn More
Pluto FixedEarn from 11% to 14% Returns annually in a fixed lock-in periodLearn More