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4 Min. Read

IMPS Vs NEFT: What’s the Difference?

IMPS Vs NEFT: What's the Difference?

If you’re someone who utilizes electronic payment methods, you may need to know about IMPS and NEFT. Both of these are funds transfer methods that allow users to move money from one account to another. Understanding how each one of these ways of transferring money works can help you pick the right transfer method for your needs.

Here’s What We’ll Cover:

What Are IMPS and NEFT?

IMPS (Immediate Payment Service)

NEFT (National Electronic Funds Transfer)

Advantages of Online Payment Transfers

Which One Should I Use?

Key Takeaways

What Are IMPS and NEFT?

IMPS and NEFT are two different internet banking options for fund transfers. To make an informed decision, understanding each of the online fund transfer modes is important.

IMPS (Immediate Payment Service)

IMPS stands for Immediate Payment Service. IMPS is a real-time payment service. Often, IMPS is referred to as one of the best online fund transfer methods available. The majority of IMPS services are available online, but some banks offer SMS services as well. Here are some of the benefits of IMPS funds:

  • IMPS transfers are available 24/7, even on bank holidays
  • IMPS is designed for transaction for amounts in low increments
  • No bank details are needed to use IMPS, but they can be used

IMPS is offered by the National Payments Corporation of India (NPCI). It allows for funds to be transferred through bank accounts or prepaid payment issuers (PPI). Prepaid payment issuers can be magnetic stripe cards or digital wallets. Depending on your preferred mode of transfer, you can do transfers through online transactions or physical ones.

How to Transfer Funds Using IMPS

To do a money transfer using IMPS, follow the steps below:

  1. Register for the mobile banking service of your choice
  2. Generate a Mobile Money Identifier (MMID) and MPIN
  3. Make sure the beneficiary customer has the MMID as well
  4. Log into the net banking portal and select IMPS as the preferred mode of transfer
  5. Fill in details and submit the transfer
  6. You’ll receive a confirmation text message once the transfer has been sent

NEFT (National Electronic Funds Transfer)

NEFT stands for National Electronic Funds Transfer. NEFT is similar to IMPS, as it is another online money transfer service. It allows for a one-to-one funds transfer from one person to another. Here are some of the biggest benefits of NEFT:

  • NEFT is available 24/7, sending batches every half hour
  • NEFT has no maximum transfer limit
  • It also has no upper limit for daily transactions

This is another great online transfer funds method available in India. Unlike IMPS, NEFT requires banking information to use it. Not all banks are available to use the service. They have to be a part of the NEFT transfer network in India.

How to Transfer Funds Using NEFT

If you need to transfer funds using NEFT, use the following steps:

  1. If your bank is in the NEFT transfer network, log into your banking portal
  2. Add the recipient of the funds as a beneficiary
  3. Enter their specific details (name, account number, account type, IFSC code) in the New Payee section
  4. Choose NEFT as the preferred mode of transfer
  5. Fill out the transfer information (transfer amount) and submit
  6. The transfer is now complete

Advantages of Online Payment Transfers

Online payment transfers are fast and convenient. They’ve become very easy to use, and allow for funds to be sent from person to person quickly. Users can avoid long lines to withdraw money for payments. Additionally, they allow for options when it comes to making payments. Users don’t have to choose just one method of transfer, they can use both if need be.

Which One Should I Use?

Depending on what you need, choosing one of these services is easy.

You should choose IMPS if:

  • You need to send a smaller amount
  • You don’t have a bank that’s compatible with NEFT
  • You want to send money while mobile

You should choose NEFT if:

  • You need to send a larger amount
  • Your bank is already compatible with NEFT
  • You do most of your online funds transfers online

Both of these online fund transfer services are good, and allow users to send money when they need to.

If you’re looking for a service that’s meant for large money transfers in real-time, look into RTGS. RTGS, which stands for real time gross settlement, allows business owners to send large amounts of money instantly.

Key Takeaways

If you need to transfer funds electronically, there are a couple of good ways. For real-time transfers of small amounts, choose IMPS. For larger amounts where you don’t need it sent immediately, choose NEFT.

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