Dear Aspirants, Banking Awareness always plays in a different role in every bank exams. The competition levels of the competitive exams are increasing rapidly day by day. To tackle all such hurdles IBPS Guide providing study notes to you people on short term basis. Here today we are providing you with the study notes on Electronic Payment Systems in India for the Banking Awareness section.
Important Points About Electronic Payment Systems
Immediate Payment Service (IMPS):
- Immediate Payment Service (IMPS) is an instant real-time interbank electronic funds transfer system in India. IMPS offer an inter-bank electronic fund transfer service through mobile phones available 24×7, throughout the year including Sundays and bank holidays.
- Customers can transfer and receive funds through IMPS using their registered mobile number and Mobile Money Identifier (MMID) or Account number and IFSC code. This facility is provided by National Payments Corporation of India (NPCI) through its NFS switch. The participants for IMPS are Remitter, Beneficiary, Banks and NFS-NPCI.
- The IMPS was publicly launched on November 2010. Currently, there are 53 commercial banks, 101 Rural/District/Urban and cooperative banks, and 24 PPI signed up for the IMPS service.
Objectives of IMPS:
- To enable bank customers to use mobile instruments as a channel for accessing their bank accounts and funds.
- To subserve the goal of Reserve Bank of India’s (RBI) encouraging the retail payments in electronic way.
- To facilitate mobile payment systems already introduced in India with the Reserve Bank of India Mobile Payment Guidelines 2008 to be inter-operable across banks and mobile operators in a safe and secured manner.
National Electronic Fund Transfer (NEFT):
- National Electronic Funds Transfer (NEFT) is a nation-wide payment system facilitating one-to-one funds transfer. Under this Scheme, individuals, firms and corporates can electronically transfer funds from any bank branch to any individual, firm or corporate having an account with any other bank branch in the country participating in the Scheme. For being part of the NEFT funds transfer network, a bank branch has to be NEFT- enabled.
- There is no limit on either minimum or maximum on the amount of funds that could be transferred using NEFT. However, maximum amount per transaction is limited to 50,000/- for cash-based remittances within India.
- The NEFT system takes advantage of the core banking system in banks. Accordingly, the settlement of funds between originating and receiving banks takes places centrally at Mumbai, whereas the branches participating in NEFT can be located anywhere across country.
- NEFT is an electronic fund transfer system that operates on a Deferred Net Settlement (DNS) basis which settles transactions in batches. From July 2017, settlements of fund transfer requests in NEFT system is done on half-hourly basis. There are twenty three half-hourly settlement batches run from 8 am to 7 pm on all working days of week.
- No charges to be levied on beneficiaries but charges only applicable for the remitter. The maximum transaction charges approved by RBI are given below:
- up to 10,000 : Rs. 2.50 + GST
- above 10,000 up to Rs. 1 lakh: Rs. 5 + GST
- above 1 lakh and up to Rs. 2 lakhs: Rs. 15 + GST
- above 2 lakhs: Rs. 25 + GST
Real Time Gross Settlement (RTGS):
- RTGS system is a fund transfer mechanism for transfer of money from one bank to another on a ‘real time’ and on ‘gross basis’, which can be defined as the continuous (real-time) settlement of funds transfers individually on an order by order basis.
- This is the fastest possible money transfer system through the banking channel. Settlements in ‘Real time’ refers payment transaction is not subject to any waiting period. The transactions are settled as soon as they are processed.
- The RTGS system is primarily meant for large value transactions. The minimum amount to be remitted through RTGS is 2 lakh. There is no upper ceiling for RTGS transactions. The objective of RTGS systems by central banks throughout the world is to minimize risk in high-value electronic payment settlement systems.
- The RTGS service window for customer’s transactions is available to banks from 9 AM to 4.30 PM on week days and from 9 AM to 2 PM on Saturdays for settlement at the RBI end. However, the timings that the banks follow may vary depending on the customer timings of the bank branches.
The maximum transaction charge on RTGS was divided into two categories:
a) Inward transactions: Free
b) Outward transactions:
- 2 to 5 lakh – 30.00 per transaction,
- Above 5 lakh – 55.00 per transaction.
Differences between IMPS, NEFT and RTGS:
|Working Time||24/7||8 AM to 7 PM(On week days)
8 AM to 1 PM(On Saturdays)
|9 AM to 4.30 PM (On week days)
9 AM to 2 PM(On Saturdays)
|Minimum Amount||Re. 1||Re. 1||2 Lakhs|
|Maximum Amount||2 Lakhs||No limit||No limit|
|Charges on Transaction||Applicable||Applicable||Applicable|
|Settlement Speed||Immediate||2 hours (Subject to cut-off time)||Immediate|
|Settlement Mode||Online||Both online and offline||Both online and offline|
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