RTGS & NEFT

December 2012

RTGS/NEFT

RTGS & NEFT are two convenient/ time effective means of transferring funds between banks in India. A cheque on the other hand takes much longer to get credited into the receivers account.

RTGS (Real Time Gross Settlement)

Fastest possible mode of money transfer through bank channels available in India. Transfer of money takes place from one bank to another in real time and on 'gross basis'.

NEFT (National Electronic Funds Transfer)

An electronic fund transfer system that operates on a Deferred Net Settlement (DNS) basis. Transactions settled in batches. Any request received after the cut-off time of a batch, will get settled in the next batch. simple, secure, safe and cost effective way to transfer funds especially for retail remittances

Source: RBI 2

Difference between RTGS & NEFT

RTGS
a. b. a. b. Large value transactions Minimum amount to be remitted is Rs.2 lac; there is no upper ceiling Timings: 9.00am 4:30 pm on weekdays Timings: 9.00 am.- 1:30 pm on Saturdays a. b. a.

NEFT
No limit either minimum or maximum-on the amount to be remitted

Timings: 9 am to 7 pm on weekdays Timings: 9.00 am.- 1:00 pm on Saturdays Transfer of cash happens in batches:

a.

Transfer of cash happens in real time; the amount usually gets credited within 2 hours of receiving the funds transfer message. a.

Transactions processed in batches from 9 am - 5 pm on weekdays & 9 am -12 pm on Saturdays, will get credited on the same day. Transactions processed in batches from 6 pm-7 pm on weekdays & 1:00 pm on Saturdays, will get credited either on the same day or on the next working day.

b.

a.

Transactions are processed continuously throughout the business hours.

a.

It operates in hourly batches; any transaction initiated after a designated settlement time would have to wait till the next designated settlement time

a.

Each transaction is settled individually

a.

Fund transfers are netted (payable and receivable)

Source: RBI 3

Steps involved RTGS/NEFT

The investor has to place a RTGS / NEFT request with his bank from where the funds are to be paid. The request should contain the following particulars:
Account Number of the Investor which is to be debited Investors Bank Account Name Amount Beneficiary Name Beneficiary Collection Account Number (Scheme Collection Account Number) Beneficiary Bank Name Beneficiary Bank Branch IFSC Code of the Beneficiary Bank.

The RTGS / NEFT request letter should be submitted by the investor to his bank and the bank acknowledged copy should be attached with the application form. The investor should get the UTR (Unique Transaction Reference) Number which is generated for their request by the bank and mention this on acknowledged copy, which is attached with the application form. RTGS can be done into the account maintained with Citibank N.A. as per the details provided below
Beneficiary Name Beneficiary Collection Account Number Beneficiary Bank Name Beneficiary Bank Branch IFSC Code DSP BlackRock Mutual Fund Collection A/c 0014410791 Citibank N.A. Fort Branch, Mumbai CITI0100000

Processing charges for RTGS/NEFT transactions

Processing charges for RTGS transactions a) Inward transactions Free, no charge to be levied.
b) Outward transactions For a transaction of Rs. 2 lac to Rs. 5 lac- Rs. 30 per transaction. For a transaction of above Rs. 5 lac - not exceeding Rs. 55 per transaction.

Processing charges for NEFT transactions

a) Inward transactions at destination bank branches (for credit to beneficiary accounts) Free, no charges to be levied from beneficiaries b) Outward transactions at originating bank branches (charges for the remitter) For transactions up to Rs. 1 lac not exceeding Rs 5 (+ Service Tax) For transactions above Rs. 1 lac and up to Rs. 2 lacs not exceeding Rs 15 (+ Service Tax) For transactions above Rs. 2 lacs not exceeding Rs. 25 (+ Service Tax)

Disclaimer: These are max charges as per RBI. Bank may have lesser charges depending on account

Source: RBI 5

Disclaimer

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.