A look at the various ways of online money transfer.
- Fund Transfer means the movement of funds between remitter and beneficiary accounts.
- NEFT is an online money transfer method with no minimum or maximum transaction limits.
- RTGS allows real-time settlement of funds and is ideal for high-value transactions.
- IMPS and UPI payments allow instant fund transfers with specific maximum transaction limits
- You can transfer funds online to domestic and international bank accounts.
The painstaking methods of conventional money transfer are well behind us. With the RBI launching innovative ways to initiate fund transfers, these mundane transactions have become more convenient and speedy. Depending on your account type, transfer amount, beneficiary location, etc., you can choose one out of the numerous ways to transfer money. This article explains the various online money transfer methods. Read on.
What Does Fund Transfer Mean?
Fund Transfer is a payment system that refers to the movement of funds from one bank account to another. It typically involves moving cash from a remitter account to a beneficiary account via a sequence of steps. Besides streamlining money transfers, this facility also allows you to repay loan EMIs, pay utility bills, and conduct other similar transactions. In India, you can initiate online fund transfers through different methods.
Online Fund Transfer Methods in India
The National Electronic Fund Transfer (NEFT) is an RBI-operated and widely preferred form of electronic fund transfer service that allows the movement of funds between bank accounts. There is no limit to the amount of money you can transfer via NEFT, and the funds get settled in batches in half-hour intervals.
Real-Time Gross Settlement (RTGS) is another fund transfer system owned and operated by the RBI. In RTGS, fund transfer takes place in real-time as opposed to half-hourly settlements. RTGS is meant for high-value transactions and with INR 200,000 being the minimum transaction amount. There is no maximum cap on the amount you can transfer via RTGS.
Immediate Payment Service (IMPS) is a 24x7x365 fund transfer facility launched by the National Payment Corporation of India (NCPI) in 2010. This real-time system offers electronic online fund transfers via mobile banking, ATMs and SMS using Mobile Money Identifier (MMID) – a 7-digit code issued to the participating banks. The MMID code is issued to mobile banking customers who wish to use the IMPS provision.
The Unified Payment Interface (UPI) is an NPCI product that enables you to initiate an online money transfer into a beneficiary’s account via a Virtual ID rather than a bank account. Most digital payment applications are UPI enabled. You can register for UPI by verifying your bank account against your registered mobile number. You only need the beneficiary’s Virtual ID and mobile number to transfer funds through UPI. The maximum transfer limit is INR 100,000, and the provision is accessible round-the-clock.
Most bank accounts now offer fund transfers to international accounts. To place the remittance request, you need the beneficiary bank account and branch details, SWIFT code, IBAN, etc. Under the RBI’s Liberalised Remittance Scheme guidelines, Resident Indians can send money to RBI-approved countries. The maximum annual transaction limit is capped at USD 250,000 (or its equivalent in other currencies).
Money Transfers have become more accessible than ever. You can transfer funds domestically and internationally at any time through convenient, RBI-authorised channels like banks and digital payment applications.
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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.