Long before UPI made instant payments a reflex, three systems built by the Reserve Bank quietly moved the country’s serious money: NEFT, RTGS and IMPS. Salary credits, property payments, business settlements and emergency transfers still ride these rails every day. They all move money between banks, but they differ sharply in speed, minimum and maximum limits, operating hours and cost — and using the wrong one can mean a delayed payment or an avoidable charge. Here is how money actually moves between Indian banks.

What NEFT is and how it works

National Electronic Funds Transfer, run by the RBI, settles transactions in half-hourly batches rather than one by one. You initiate a transfer with the recipient’s account number and IFSC; your bank sends it into the next available batch, and the money typically reaches the beneficiary within a couple of hours. NEFT works 24×7, including weekends and holidays, a facility extended in December 2019. There is no minimum amount, and while individual banks may set their own per-transaction caps for safety, the RBI imposes no upper limit — which makes NEFT the workhorse for routine transfers from a few hundred rupees to several lakhs. For savings account holders, the RBI has directed that online NEFT transfers be free of charge, so there is no reason to pay for what should cost nothing.

What RTGS is for

Real Time Gross Settlement is the heavy-lifter: each transaction is settled individually and immediately in the RBI’s books, with no batching and no waiting. It is designed for large-value, time-critical payments — property deals, inter-corporate settlements, high-value investments — and carries a minimum threshold of 2 lakh rupees per transaction, with no maximum limit. Like NEFT, RTGS operates round the clock on all days. Because settlement is gross and real-time, once an RTGS payment is confirmed it is final and irrevocable, which is exactly what parties to a big transaction want. Banks were asked to pass on the benefits of the system efficiently, and online RTGS transfers are typically free or carry only nominal charges for most retail customers.

What IMPS does differently

Immediate Payment Service, run by the National Payments Corporation of India, was India’s first 24×7 instant interbank transfer system, launched in 2010. Unlike NEFT’s batches, IMPS credits the recipient within seconds, day or night. It works through account number plus IFSC, or through a Mobile Money Identifier linked to a phone number, which made it the original backbone of mobile banking transfers. The per-transaction limit stands at 5 lakh rupees, raised from 2 lakh in 2021. IMPS remains the right tool for urgent mid-sized transfers — say, sending 3 lakh rupees to a family member at midnight — where NEFT would be slower and RTGS cannot be used below its 2 lakh floor. Small charges may apply depending on your bank and channel, though many banks keep mobile IMPS free up to limits.

NEFT vs RTGS vs IMPS: which to use when

The decision tree is simple. For routine transfers where a couple of hours’ delay is fine — rent, vendor payments, moving money between your own accounts — use NEFT: no minimum, no real maximum, and free online. For urgent transfers above 2 lakh rupees where finality matters — a property token amount, a business settlement — use RTGS. For instant transfers at any hour, especially from a phone — an emergency remittance, a late-night payment — use IMPS. And for small everyday person-to-person payments, UPI has largely taken over the space below 1 lakh rupees, which is why these three systems now handle the economy’s heavier lifting.

• NEFT: batched, up to a few hours, no minimum, no RBI maximum, free online for savings accounts.
• RTGS: instant and final, minimum 2 lakh rupees, no maximum, for large critical payments.
• IMPS: instant 24×7, up to 5 lakh rupees, works on mobile numbers, for urgent mid-size transfers.
• Always verify: account number and IFSC before confirming — wrong credits are painful to reverse.

What happens behind the scenes

When you hit confirm, your bank debits your account and sends a payment message through the RBI’s or NPCI’s network; the beneficiary’s bank credits the account and confirms back. If anything fails midway — a wrong IFSC, a frozen account — the money returns to you, typically within a few hours for NEFT and RTGS and quickly for IMPS. Keep the UTR or transaction reference number; it is the tracking ID that lets either bank trace the payment. And a practical tip: NEFT and RTGS need the correct 11-character IFSC, so copy it from the beneficiary’s cheque or official bank source rather than typing from memory.

FAQs

Is NEFT available on Sundays and holidays? Yes — NEFT and RTGS both run 24×7 on all days, including weekends and bank holidays, since December 2019.

What is the maximum I can send through IMPS? Five lakh rupees per transaction. For larger instant needs, RTGS handles any amount above 2 lakh rupees.

Are these transfers free? Online NEFT is free for savings account holders by RBI direction; RTGS and IMPS charges, where levied, are typically small and many banks waive them on digital channels.

NEFT, RTGS and IMPS are the plumbing of Indian finance — invisible when they work, which is almost always. Know which pipe fits your payment: NEFT for routine, RTGS for large and final, IMPS for instant, and you will never be stuck waiting on money that should already have arrived.

Compiled by the Khabar 24h Editorial Desk from publicly available sources.