Home / Money / Personal Finance /  NEFT money transfer round-the-clock from December. How it is differs from IMPS

If you have used the National Electronic Funds Transfer (NEFT) payment system, you will be aware that there is a cutoff time to send money through this channel. The NEFT payment system so far is available for customers from 8 AM to 7 PM on all working days, except the second and fourth Saturdays of the month.

In order to provide convenience to customers, the Reserve Bank of India (RBI) has decided to make the service available on a 24x7 basis from December 2019. This means you will be able to send and receive money anytime. However, since the transaction happens in batches, there could be a lag of maximum 30 minutes.

How it will work

To enable this change, the RBI and the banks will have to rework the back-end process. “There is a connectivity pipe between banks and the RBI. The NEFT process runs in batches — every 30 minutes, a batch that is cleared. For instance, if we send the money at 12 PM and the batch time is 12:30 PM, whatever they have received will be sent to all other banks," said Surinder Chawla, head of retail and wealth management, RBL Bank. Essentially the clearing process in batches will keep running and getting processed at the back-end. Customers can make the transfers at any time. Banks usually keep excess amount for the NEFT transaction to get auto debited for it.

How is IMPS different?

Currently, IMPS offers transaction facilities 24x7. “In case of IMPS, there is a value cap but NEFT doesn’t have any such limit.

“Technically, for NEFT there is no cap from the RBI. However, most banks put a cap per customer or per transaction as there are chances of hacking and phishing," said Chawla. Moreover, settlement happens in the bank accounts so the banks have to account for the money in advance. “Currently, we keep the amount till 7 PM. And if someone sends a higher amount late night, we push it to the RBI account and leave. Now the banks will have to factor it in," he added.

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