National Electronic Funds Transfer (NEFT) is a widely used system that enables the electronic transfer of funds from one bank account to another across India.
Regulated by the Reserve Bank of India (RBI), NEFT ensures secure and reliable transactions between banks, making it a preferred method for personal and business money transfers.
Understanding the meaning of NEFT
NEFT (National Electronic Funds Transfer) is an interbank system that facilitates electronic money transfers across India. It processes transactions in batches, typically every 30 minutes, allowing individuals and businesses to send funds quickly and cost-effectively.
Unlike RTGS, which is for large-value transfers, NEFT is ideal for everyday transactions with no minimum or maximum limits, providing a secure and efficient way to transfer money domestically.
Features of NEFT
- No minimum limit: You can transfer as little as ₹1, making NEFT accessible for small and large transactions alike.
- Available 24/7: NEFT operates around the clock, every day of the year, including weekends and holidays.
- Nationwide service: You can send money to any NEFT-enabled bank account across India.
- Batch processing: NEFT transactions are processed in batches, typically every 30 minutes.
- Safe and secure: Regulated by the Reserve Bank of India (RBI), NEFT ensures a high level of security for all transactions.
- Online and offline access: You can initiate NEFT transfers through internet banking, mobile apps, or by visiting a bank branch.
How does NEFT work?
NEFT transactions follow a specific process to ensure the secure transfer of funds. Here’s how it works:
Initiate transfer: Fill out a NEFT form online or at the bank with the beneficiary's name, account number, IFSC code, and the transfer amount.
Bank submission: Axis Bank forwards the transaction to the NEFT Service Centre, which collects transactions in batches.
Batch processing: Transactions are processed every 30 minutes at the NEFT Clearing Centre.
Transfer to the recipient: The Clearing Centre forwards the funds to the recipient’s bank, which credits the beneficiary’s account. Notifications are sent upon completion.
Failed transactions: In case of errors, the funds are returned to the originating bank within two hours.
Necessary details required for NEFT transfer
- Beneficiary’s full name
- Beneficiary’s bank account number
- IFSC (Indian Financial System Code) of the recipient’s bank branch
- Type of account (Savings Account or Current Account)
- Amount to be transferred
- Your own bank account details for the debit
Understanding NEFT charges
- Inward transactions (received): No charges are levied on the recipient of NEFT transfers.
- Outward transactions (initiated): Charges may vary based on the amount being transferred. For example:
- Transfers up to ₹10,000: Usually ₹2.50 plus GST
- ₹10,001 to ₹1 lakh: Approximately ₹5 plus GST
- ₹1 lakh to ₹2 lakh: Around ₹15 plus GST
- Above ₹2 lakh: Up to ₹25 plus GST
Conclusion
NEFT is an essential, secure, and highly accessible payment system for transferring money within India. Its affordability, flexibility, and 24/7 availability make it ideal for both personal and business transactions.
To experience hassle-free transfers, consider using services like Axis Bank’s NEFT Transfer, which offers zero charges for transactions via Internet banking and mobile banking.
Also Read: UPI Vs. NEFT – All You Need To Know
FAQs
Can NEFT be used for international transfers?
No, NEFT is only for domestic transfers within India. For international remittances, services like SWIFT or Wire Transfer are used.
How long does an NEFT transaction take to process?
NEFT transfers are typically completed within a few hours and processed in half-hourly batches throughout the day.
Can I use NEFT for business transactions?
Yes, NEFT is commonly used for business transactions, such as paying suppliers or salaries, with no transfer limits.
Is NEFT available 24/7?
Yes, NEFT operates 24/7, including holidays, with transfers processed in the next available batch.
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
