NEFT or National Electronics fund transfer is a facility provided (in India) by almost all local banking institutions.
As explained in a blog post from the Fintech company Payment, NEFT is one of the preferred methods of sending money transfers to India. Via NEFT, users can transfer funds via the Internet or online banking services from the comfort of their own homes.
All NEFT transfers and associated guidelines are determined by the Reserve Bank of India (RBI), which aims to ensure adequate safety and security of monetary transactions. If you want to take advantage of the benefits that NEFT transfers offer, you must have a basic understanding of how NEFT actually works, the amount of fees you will pay for these transactions, and the NEFT settlement time frame.
As stated by Paytm, NEFT services are currently available 24/7, including public holidays. But these services are “settled in half-hour batches,” the Fintech firm noted, adding that this means NEFT transactions are “settled in 48-hour batches, every day.”
As mentioned in a blog post from Paytm, settlement for the first batch of NEFT transfers starts at 12:30 a.m. and ends at 12:00 a.m. This is done “to allow the settlement of a greater number of transactions in order to reduce the NEFT settlement time; thus making it more convenient for users.
The Fintech company also mentioned that all NEFT transfers that take place during the banks’ normal working hours are “considered to be automated transactions that are initiated via ‘Straight Through Processing’ (STP) modes by the banks.”
Commenting on when clients are able to complete NEFT transfers, the company noted that since all of these transactions are conducted under the direction of RBI, the “times and processes of NEFT transactions are all within the purview of the RBI. “.
Prior to December 2019, RBI had set up fixed schedules during which NEFT transfers would be processed. Any NEFT transfer could be “processed only between 8:00 am and 6:30 pm Monday to Friday, and 8:00 am to 12:00 pm on Saturday”.
But from last year, NEFT transfers can be done 24/7. This was done “to promote digital transactions and the global integration of financial markets”.
The Paytm team further explains that NEFT uses a fairly simple mechanism to “transfer funds from one bank account to another”.
Responding to a question on how to transact through NEFT, the Fintech company noted that transferring funds through NEFT is “easy and convenient” and you just need to follow these steps:
- Log into your online banking account
- On the main page, click on ‘Transfer funds’
- In the drop-down menu that appears, select “NEFT”
- Note that you must “Add a beneficiary” to the list of beneficiaries of your account if you have not already done so.
- To add a new beneficiary, you must click on the option “Add a beneficiary” on the page
- Enter the required information of the beneficiary such as name, bank account number, IFSC, etc.
- Click on ‘Confirm’ or ‘Add’
- To authenticate this step, you will be asked to enter the OTP sent to your registered mobile number
- After that, your action will be processed. It will take about 24 hours to add a beneficiary
- Once the beneficiary has been added to your account, you must select the details of the beneficiary (to whom you must send the money) from your list of beneficiaries
- Enter the amount to transfer and confirm your transaction
- Click on “Confirm” and the amount will be transferred from your bank account to another
Commenting on the amount of fees applicable to NEFT transactions, the company noted that until December 2021, these types of transfer shares involved some additional fees (relatively low by international standards) as money transfer fees. .
However, the RBI will remove all applicable fees on NEFT online transfers. This move was taken to “promote digital transactions,” the Paytm team noted while adding that the RBI said that no bank (in the future) “will charge fees from their account holders. savings on online fund transfers made via NEFT (National Electronic Funds transfer system).
As explained by Paytm, NEFT has become one of the most preferred modes of money transfer because:
- One of the main advantages is that “there is no limit on transfer of minimum or maximum NEFT amount”;
- Users can “transfer as low as Re.1 via NEFT”;
- You can “transfer money via NEFT online; without the intervention of checks or sight drafts or without having to go to the bank ”;
- RBI has “established such guidelines which allow the sender and receiver to stay informed of the transfer of funds through SMS and / or e-mail notifications”;
- Funds via NEFT “can be transferred between 1 hour and 24 hours”;
- Since NEFT transactions “are governed by the RBI, there is no doubt about the security of these transactions.”