Payment Systems In India.

Since the evolvement of Net Banking in our country, we have been given two main settlement systems and they are National Electronic Funds Transfer (NEFT) & Real Time Gross Settlement (RTGS) by RBI.Another settlement system  Immediate Payment Service (IMPS) is a relatively new service in India when compared to NEFT and RTGS.

So, If you are eager to transfer funds online you have mainly three options in NEFT, RTGS, and IMPS, but nowadays a new interface is only there for making transaction Online and it is Unified Payment Interface(UPI) given by National Payments Corporation of India(NPCI) that is in demand these days for all good reasons. So In this article of mine, we will discuss the available payment systems and how they are different from one another.

NEFT was introduced in November 2005 and RTGS was introduced in the March 2004 are settlement systems by RBI while IMPS is settlement mechanism introduced by National Payment Corporation in 2010.UPI's pilot launch was done by ex-RBI governor Mr.Raghuram Rajan on 11 April 2016.

NEFT vs RTGS vs IMPS vs UPI

NEFT(National Electronic Funds Transfer):

• NEFT transactions are transactions of small amounts.

• This transaction doesn’t take place instantly but happens during a specific time which is termed as a batch. On weekdays there are 12 such batches while on Saturday there are 6 batches when the money is transferred.

• The transaction can take place between 8 am to 6.30 pm on the weekday. On Saturday between 8 am to 12.30 pm.

• So if someone sends you payment via. NEFT it would take about 1 to 2 hours to reflect in your bank account.

RTGS(Real Time Gross Settlement):

• As the name suggests its a real time transfer service between banks. The minimum amount required to be transferred is 2 lakh.(RBI has not fixed the maximum amount. It has given liberty to the bank to decide the maximum amount.)

• The transaction happens immediately. It can be accessed from 8 am to 4.30 pm on weekdays and 9 am to 12.30 pm on Saturday.

IMPS(Immediate Payment Service):

• In this service, users can transfer funds within the same bank and other banks on an immediate basis by using mobile numbers that have been linked with the account number of banks.

• There is no maximum limit set for such transactions. You can transfer up to 5 lakh easily.

UPI(Unified Payment Interface):

• UPI is launched by NPCI and it is currently the simplest way of sending and receiving money online. 


• In order to send money to your friend's account, you simply need the virtual address of your friend that can be his mobile number or his Adhar number or any other number that has been set by him, you don't really need to worry about filling the details like account number, IFSC code etc. If you and your friend are using UPI then it is the fastest and the easiest way of making Transactions.


• On the term of security as it is managed by NPCI that is the heading organization of payment systems in India so you don't have to really worry about it.


• All major banks are providing their UPI apps and also the newly launched BHIM app of our Indian government works with UPI.

Points to note:

• The maximum allowed amount has not been fixed by RBI. RBI has given the rights to the bank to set this amount. The maximum allowed amount is set by the bank board.

• The fees charged differs from bank to bank.

• In NEFT and RTGS, one cannot transfer funds on Sunday and on public holidays. While in IMPS it is possible to do a transaction on these days so as with the UPI as well.