Differentiate between NEFT and RTGS. (2 points each)
Answers
Answer:
NEFT (National Electronic Funds Transfer)
With NEFT, you can transfer any amount to the recipient’s account in a one-on-one transfer basis. NEFT transactions don’t have a maximum limit for funds that can be transferred in a single day.
– Timings for NEFT
The NEFT system is available round the clock throughout the year on all days (24x7x365). Funds are transferred in batches that are settled in 48 half-hourly time slots throughout the day.
– Transaction limits
There is no maximum or minimum limit on the amount of funds that could be transferred through NEFT. With NEFT, you can initiate transactions to transfer funds from one bank account to another throughout India. However, you must make sure that the banks are a part of the NEFT transfer network (another way to say this is that the banks should be NEFT-enabled).
– Procedure
To transfer funds via NEFT, all you have to do is log in to your net banking portal and add the recipient as a beneficiary. You’ll need to enter details like their name, account number, account type and IFSC code under the Add New Payee section. Once you choose NEFT as the preferred mode of transfer and enter the amount to be transferred, the fund transfer will be completed.
RTGS (Real Time Gross Settlement)
Business owners can use RTGS when they need to transfer large amounts instantly. One advantage that RTGS has over the other methods is the transaction speed, since the entire amount is transferred in real time.
– Timings for RTGS
Though the available hours for RTGS transactions vary based on the individual banks and their branches, this is the standard timing:
7:00 a.m. to 6:00 p.m. for customer transactions
7:00 a.m. to 7:45 p.m. for inter-bank transactions
From December 2020, the RTGS system will be available round the clock on all days (24x7x365).
– Transaction limits
There’s a minimum limit of Rs. 2 lakhs for RTGS transactions, and there’s no maximum limit as such.
To get an RTGS-enabled account, you can either contact your bank or check your eligibility status in your online banking portal. If you’re using RTGS for a fund transfer, make sure that both you and the recipient have RTGS enabled accounts.
– Procedure
To transfer funds via RTGS, log in to your banking portal and add the recipient as a beneficiary by entering details like their name, account number, account type and IFSC code. Then choose RTGS as the mode of transfer and enter the amount to be transferred, and the fund transfer will be completed....
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Answer:
RTGS is based on gross settlement, NEFT is based on net-settlement. Gross settlement is where a transaction is completed on a one-to-one basis without bunching with other transactions. ... Usually RTGS costs more than NEFT Transactions.