9th FEB Banking Term

NEFT (National Electronic Fund Transfer): NEFT enables funds transfer from one bank to another but works a bit differently than RTGS. NEFT is slower than RTGS. The transfer is not direct and RBI acts as the service provider to transfer the money from one account to another. You can transfer any amount through NEFT, even a rupee. Minimum limit: No Minimum limit, Maximum Limit: No maximum limit.

RTGS (Real time gross settlement): RTGS system is funds transfer systems where transfer of money or securities takes place from one bank to another on a "real time" and on "gross" basis. Settlement in "real time" means payment transaction is not subjected to any waiting period. The transactions are settled as soon as they are processed. Minimum &Maximum Limit of RTGS: 2 lakh and no upper limit.

IFSC: IFSC code means Indian Financial System Code. RTGS and NEFT payment system of Reserve Bank of India (RBI) use these codes. IFSC code consists of 11 Characters identified as under (Lets take an example of SBI, Madhapur Hyderabad):- First 4 digits show the Identity of the bank. i.e. SBIN 5th digits in default as ZERO (for future use) i.e. 0 Last 6 Characters display the Branch Identity. i.e. 004187 So IFSC Code is SBIN004187