Effective from 1st June 2019, RBI extended the timings available for RTGS Timings. Hence, let us see the new NEFT and RTGS Timings.
RBI in it’s new circular dated 28th May 2019, declared that RTGS timings have extended up to 6 PM rather than the existing 4.30. This is I think a good move for all of us.
What is the difference between NEFT and RTGS?
Before jumping to understand the new changes, let us have a basic understanding of what is NEFT and what is RTGS.
What is the meaning of NEFT or National Electronic Funds Transfer?
It is a nationwide payment system facilitating one-to-one fund transfers. Using this system, you can transfer funds from any bank branch to any individual having an account with any other bank within India.
Let us take an example. Mr.X has a bank account with HDFC and he wants to transfer the money to Mr.Y, whose account is with ICICI. Therefore, by using NEFT facility Mr.X can transfer money to Mr. Y’s bank account.
There is no minimum or maximum limit for NEFT Transfer.
What is the meaning of RTGS-Real Time Gross Settlement?
In NEFT, money transfer requests are clubbed together called batches. Such batches are settled based on Deferred Net Settlement (DNS) on hourly base during NEFT timings. Whereas in RTGS it is real time. It means money transferred individually instead of batches instantly. Therefore, compare to NEFT, RTGS is faster.
Let us take an example. Mr.X has a bank account with HDFC and he wants to transfer the money to Mr.Y, whose account is with ICICI. Therefore, by using RTGS facility Mr.X can transfer money to Mr. Y’s bank account instantly. In this transaction, HDFC transfers the initiated transfer amount to ICICI bank instantly. However, ICICI bank has a maximum of 30 minutes time to deposit into Mr. Y’s account. Hence, depending on the beneficiary bank’s procedure within two hours Mr.Y get the amount in his account.
The minimum amount to be transferred under RTGS is Rs.2,00,000. However, there is no upper limit.
New NEFT and RTGS Timings – Effective from 2019
The recent change by RBI is only about RTGS but not with NEFT. Hence, the schedule of NEFT will be as usual. Let us see the new NEFT and RTGS Timings effective from 1st June 2019.
Note:-Effective from 26th August 2019, RBI increased operating timings of RTGS. Earlier it was at 8 AM. But effective from 26th August 2019, it will be from 7 AM in the morning.
As I pointed, there is no change in NEFT timings. However, in case of RTGS, the earlier customer transaction last timing was 4.30. This is now extended up to 6 PM. Hence, the additional 1.30 hours for the customers to transfer the fund using the RTGS facility.
NEFT and RTGS Charges 2019
As per the Press Release of RBI Dated 6th June 2019, RBI completely removed the NEFT and RTGS charges which it used to levy on Banks for such transactions and asked the banks to transfer the benefits to customers.
“The Reserve Bank levies minimum charges on banks for transactions routed through its Real Time Gross Settlement System (RTGS) meant for large-value instantaneous fund transfers and the National Electronic Funds Transfer (NEFT) System for other fund transfers. Banks, in turn, levy charges on their customers. In order to provide an impetus to digital funds movement, it has been decided to do away with the charges levied by the Reserve Bank for transactions processed in the RTGS and NEFT systems. Banks will be required, in turn, to pass these benefits to their customers. Instructions to banks in this regard will be issued within a week.”
Hence, effective from 2019, there will be no charges on NEFT and RTGS transactions for bank customers.