Differences Between NEFT and RTGS

NEFT and RTGS are the two electronic means that influence financial transactions. The difference between NEFT and RTGS is the way how they transfer money.

NEFT stands for National Electronic Funds Transfer, where financial transactions are based on the near term. On the other hand, RTGS or Real-time Total Resettlement, continuous or instant money transfer.

What is NEFT?

National Electronic Funds Transfer (NEFT) is defined as a nationwide fund transfer mechanism through which an individual or organization can easily transfer funds from one account/bank/branch to another.

This system is based on net deferred settlement, where transactions take place between hours. In this system, transactions are held for a limited period of time.

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What is RTGS?

The electronic system for transferring money online in real-time is called RTGS or Real-Time Cross Settlement. Actual time refers to the transaction taking place at the same time the order is received.

Thus, there is no delay in solving problems. The general meaning is that each transaction is determined individually or on a basis.

Basic Difference RTGS Vs NEFT

The basic difference between RTGS and NEFT, RTGS is based on the complete solution. while NEFT is based on the net solution.

The complete solution is to perform one transaction after another without accumulating other transactions.
In the event of a net deferred base (DNS) or net settlement, the transactions will be completed in a timely manner.

Here, all transfers will be paused for a while. RTGS transactions are processed in system times.

Differences Between NEFT and RTGS

The differences between NEFT and RTGS is given as follows:

• NEFT stands for National Electronic Fund Transfer. It is an online payment system through which funds can be transferred from one place, branch, or account to another. Real-time Cross-Settlement or RTGS is an online money transfer tool through which funds are transferred on a structured basis.
• NEFT was introduced in 2005 as an alternative to Specialized Electronic Funds Transfer (SEFT). In contrast, RTGS was introduced in 2004.
• NEFT is based on a Deferred Net Settlement System (DNS), while RTGS operates on a one-to-one basis.
• Normal business hours on business days, departures for NEFT and RTGS on the second and fourth Saturdays are from 8:00 AM to 7:00 PM and from 9:00 AM to 4:30 PM.
• In the case of NEFT, there are a total of 12 solutions per working day. But if we talk about RTGS, this solution persists.
• NEFT operates between hours. While RTGS operates on a real-time basis.
• There is no minimum or maximum for NEFT. However, the amount of each transaction should not exceed Rs. 50,000 cash. On the other hand, the minimum RTGS is 200,000 and there are no ceiling restrictions.
• NEFT is ideal for small volume transactions. Unlike RTGS which is suitable for large-scale transactions.
• RTGS is an instant money transfer system. But NEFT transfers take time.

Final Words

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