The Reserve Bank of India (RBI) on Friday proposed to increase the per transaction limit on the Immediate Payment Service (IMPS) from the existing Rs 2 lakh to Rs 5 lakh.
IMPS managed by the National Payments Corporation of India (NPCI) is a payment system providing 24x7 instant domestic funds transfer facility and is accessible through various channels like internet banking, mobile banking apps, bank branches, ATMs, SMS and IVRS.
Apart from IMPS, National Electronic Funds Transfer (NEFT) and Real Time Gross Settlement (RTGS) are also the platforms of money transfer. Using these services, customers can transfer money from one bank account to another without dealing with bank staff.
Let's take a closer look at these:
IMPS enables individuals to make money transfers instantly through banks across the country. It is available round the clock throughout the year, even on bank holidays.
The eligible criteria for the banks who can participate in IMPS is that the entity should have valid banking or prepaid payment instrument license from the Reserve Bank of India to participate in IMPS.
Currently, customers can send up to Rs 2 lakh using this facility. However, after RBI's proposal, this limit will be extended to Rs 5 lakh.
National Electronic Funds Transfer (NEFT) is a nationwide centralised payment system owned and operated by the Reserve Bank of India (RBI). It offers round-the-clock availability on all days of the year and provides near-real-time funds transfer to the beneficiary account and settlement in a secure manner.
NEFT has a PAN-India coverage through a large network of branches of all types of banks.
There is no limit imposed by the RBI for funds transfer through the NEFT system. However, some lenders may place amount limits based on their own risk perception with the approval of their board.
RTGS can be explained as a system where there is a continuous and real-time settlement of fund transfers, individually on a transaction-by-transaction basis (without netting).
'Real Time' means the processing of instructions at the time they are received; 'Gross Settlement' means that the settlement of funds transfer instructions occurs individually.
Considering that the funds' settlement takes place in the books of the Reserve Bank of India, the payments are final and irrevocable.
The minimum amount to be remitted through RTGS is Rs 2 lakh with no upper or maximum ceiling.
(Edited by : Ajay Vaishnav)