NEFT, RTGS, IMPS: Meaning, Full Form, Benefits and Difference

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Here’s a comprehensive guide explaining the difference between IMPS, NEFT and RTGS vs other payment modes! Take a look!

With digital payment services such as IMPS, NEFT, and RTGS, merchants can easily transfer funds electronically from one bank account to another.

Let’s take a look at these different types of electronic fund transfer systems and understand the difference between the three in detail.

What is IMPS? What is IMPS full form?

IMPS (Immediate Payment Service) is a real-time fund transfer system developed by NPCI (National Payments Corporation of India). It enables instant money movement between bank accounts—24×7, 365 days a year, including holidays.

It’s best suited for low- to mid-value personal or business transactions that require instant confirmation.

Transfer Speed: Instant
Service Availability: 24×7, including Sundays and bank holidays
Minimum Transfer Limit: ₹1
Maximum Limit: ₹5 lakh/day (varies by bank)

IMPS for Businesses:

Ideal for instant customer refunds, payroll advances, or gig worker payouts
Not preferred for high-volume bulk transfers due to daily caps

Note: Banks may impose lower IMPS caps than ₹5L and levy nominal fees for large-value IMPS transactions. Always confirm with your bank.

What is NEFT?What is NEFT full form?

NEFT (National Electronic Funds Transfer) is a batch-based fund transfer system regulated by the Reserve Bank of India. Though traditionally slower than IMPS, NEFT now operates in half-hourly batches round the clock (24x7x365).

Transfer Speed: Processed every 30 minutes (24×7)
Minimum Limit: ₹1
Maximum Limit: No upper cap (except ₹50,000 for cash deposits at branches)

NEFT for Businesses:

Perfect for vendor payments, salaries, reimbursements, and GST payouts
Supported by all banks and widely accepted for bulk CMS transactions

Tip: While NEFT is slightly slower than IMPS/RTGS, it’s more cost-effective for bulk payouts and offers a paper trail that aligns well with bookkeeping and audits.

RTGS Meaning and Full Form

RTGS (Real-Time Gross Settlement) is designed specifically for high-value fund transfers. Unlike NEFT, RTGS processes each transaction individually and in real time—making it the most reliable mode for urgent, large-sum payments.

Transfer Speed: Instant
Minimum Transfer Limit: ₹2 lakh
Maximum Limit: No upper limit
Service Availability: 24×7 (but execution may depend on bank processing windows)

RTGS for Businesses:

Ideal for real estate payments, large vendor settlements, institutional fees, and intercompany transfers
Reduces payment risk due to immediate settlement

RTGS may still have scheduled maintenance windows or delayed batch settlement during late-night hours depending on your bank.

What’s the Difference Between NEFT and RTGS

The Reserve Bank of India (RBI) introduced NEFT and RTGS, while the National Payments Corporation of India (NPCI) introduced IMPS. Collectively, these payment systems have eased the entire fund transfer process. Merchants no longer need to frequently visit bank branches to request fund transfers and pay transaction charges. Everything can be done via mobile and net banking services. They’re fast, convenient, and come in handy from a documentation point of view as well.

However, each of these is quite different at a micro-level. The table below details their difference. Let’s take a look at the difference between NEFT, RTGS and IMPS.

Categories	IMPS	NEFT	RTGS
Basic details	Built by the National Financial Switch network and managed by the National Payments Corporation of India (NPCI).	Owned and operated by the Reserve Bank of India.	Owned and operated by the Reserve Bank of India.
Settlement Process	Instant money transfer into the beneficiary’s account.	Works on a net and batch basis. Payments are released in batches, in a gap of a minimum of 30 minutes.	Instant money transfer into the beneficiary’s account.
Service Timings	Available 24×7, and 365 days	Available 24×7, and 365 days	Available 24×7, and 365 days
Minimum Transfer Limit	₹1	₹1	₹2 lakh
Maximum Transfer Limit	₹5 lakh per day	No NEFT limit set by RBI. Charges may vary from bank to bank. In the case of cash transactions, the maximum limit is ₹50,000.	No RTGS limit set by RBI.
Transaction Charges	Charges vary from one bank to another.	No charges for online transactions. Charges are applicable when fund transfer is initiated at a bank branch. Charges vary from one bank to another.	No charges for inward and online transactions. Charges may be applicable for outward transactions for amount: ₹2 lakh-₹5 lakh: not exceeding ₹25Above ₹5 lakh: not exceeding ₹50GST applicable
Mode of Payment	Online	Online & offline	Online & offline

Things To Consider When Choosing Between IMPS, NEFT, And RTGS

Now that we’ve established the basic difference between the IMPS, NEFT, and RTGS, let’s look at some key pointers to consider when selecting any of these channels to initiate a fund transfer.

Transaction Fees: Compare IMPS vs NEFT vs RTGS charges, as they vary across banks. Some banks offer fee waivers for online transactions.
Transfer Limits: Choose a system that meets your transaction amount. For example, use RTGS for large payments over ₹2 lakh, while IMPS is ideal for smaller, instant transfers.
Processing Time: NEFT operates in batches, so it may not be as fast as IMPS or RTGS.
Availability: All three systems operate 24×7, but check if your bank has any maintenance schedules.

Bulk Payments: NEFT Vs RTGS Vs IMPS

Using IMPS, NEFT, and RTGS for Bulk Payments

Bulk payments like salaries, reimbursements, and vendor payouts—are mission-critical for businesses. And while traditional methods like IMPS, NEFT, and RTGS can be used for bulk transfers, they differ significantly in suitability, ease, and scale.

Here’s how to evaluate each:

Mode	Best For	Limitations
NEFT (Batch)	Monthly salaries, vendor payments, reimbursements	Slight delay due to half-hour batch processing
RTGS (Real-time)	High-value B2B transactions like rent, vendor settlement >₹2 lakh	Minimum amount is ₹2 lakh
IMPS (Real-time)	Low-value disbursements like refunds, gig payouts	Bank-imposed ₹5L daily cap makes it unfit for true bulk

Want automation? Go beyond traditional banking.

While banks offer CMS (Cash Management Services) for bulk payouts, the setup is often manual and rigid. Businesses that want API-based, instant, error-proof payouts now prefer modern payment service providers (PSPs).

How PSPs Like Cashfree Streamline Bulk Payouts

Instead of manually uploading payout files or verifying UTRs on banking portals, Cashfree lets you:

Send thousands of payouts with a single file or API call
Choose the ideal mode per transaction (NEFT, RTGS, IMPS, UPI) automatically
Integrate directly with your ERP or payroll software
Track success/failure with detailed MIS in real time
Handle reverse payouts, refunds, and reconciliations without manual ops

Whether you’re a startup paying influencers or an enterprise processing thousands of vendor payments; modern payout rails eliminate the legacy friction.

Modern Bulk Payment Solution: Cashfree Payments

Cashfree Payments provides businesses with advanced payment solutions that go beyond traditional systems like NEFT and RTGS. Here’s why Cashfree Payments is a preferred choice:

Highly cost-effective
Fast turnaround time
Single file upload to make multiple payments at the same time
Completely secured payment networks
Streamlined finances
Reverse MIS integration available with many ERPs
24×7 grievance redressal
Intuitive dashboard to easily access necessary reports

IMPS Vs NEFT Vs RTGS Vs Other Payment Modes

Innovative transformations in the field of financial technology have introduced many more and highly sophisticated modes of payments besides the above-mentioned fund transfer systems. For instance, as a merchant, you can use e-wallets, UPI, net banking, credit cards, and debit cards to make and receive instant payments.

Let’s dive deep to understand these new payment systems and analyse how they’re different from the primitive ones.

UPI (Unified Payment Interface)

UPI or Unified Payment Interface is a real-time payment method introduced by the National Payment Corporation of India (NPCI). It’s regulated by the Reserve Bank of India. The payment system facilitates inter-bank fund transfer through your mobile phone.

The steps to use UPI are as follows:

Download the UPI app on your smartphone
Register with your mobile number and verify your account
Ensure you have a bank account with a UPI-member bank
Link your bank account(s) and create a four/six-digit UPI PIN
Your account is ready to send/receive money

Common and most trusted UPI apps in India include BHIM by NPCI, Paytm, Google Pay, and PhonePe. You can use either of the platforms to receive and send money no matter if you’re a merchant or a customer.

Fast and Instant
No Transfer Limits for Individuals
Popular Apps: BHIM, Paytm, Google Pay, PhonePe

E-Wallets

As the name suggests, e-wallets enable you to facilitate cashless transactions anytime, anywhere using virtual wallets. Their utility is proximately similar to credit and debit cards. As a customer, you can load them with money to make payments whenever needed.

Similarly, as a merchant, you can also accept payments in your e-wallets. Just register yourself as a merchant with one of these platforms, get your own QR code/e-wallet ID and receive payments from customers.

Popular E-wallets: Amazon Pay Amazon Pay, Paytm wallet, Phonepe wallet, Mobikwik, HDFC Payzapp, Lazepay, and FreeCharge.

Payment Links

Payment link is a fairly new payment receipt concept of the Fintech industry. Simply send a payment link to your customers via email, SMS, Whatsapp, or any other communication channel. Ask them to open the link and make the payment.

Platforms like Cashfree Payments also enable merchants to generate payment links in bulk to save time and reduce the margin of errors.

Customers here, get the liberty to choose from a wide range of payment options such as credit/debit card, UPI, e-wallets, net banking, etc. to make payments.

Accepting money via payment links is quick, easy, and convenient for both customers and merchants. Payment collection can also be done via QR code sharing.

Flexibility: Customers can use credit/debit cards, UPI, or e-wallets.

Debit Card

A debit card is a bank-issued payment card that debits or deducts money directly from your bank account when used for making a purchase.

Debit cards are an excellent alternative to cash and a great way to make payments instantly simply via a chip & PIN. You can go contactless and even use your phone to operate your debit card to make payments.

Credit Card

Credit cards are similar to debit cards with one key difference. Money is not deducted from your bank account immediately. Rather, you have the flexibility to pay the amount at a later date, usually within 30 days. Every credit card also comes with a set credit limit that can be used to make payments/purchases.

With a credit card, you can pay online, using a chip & PIN, contactless, or through your phone.

Here is how the credit card processing system usually works.

Prepaid Cards

Prepaid cards are another alternative to cash and are quite similar to debit and credit cards. The only key difference here is that you don’t need an account to have a prepaid card. Instead, just load money into the card and use it till your balance runs out. It operates much on the pay-as-you-go phenomenon.

You can use prepaid cards to pay online, at stores, and even at other places that accept these cards.

Role Of Payment Service Providers (PSPs) in Banking Sector

While the core banking services such as IMPS, NEFT, and RTGS remain in the limelight, they’re not sufficient or rather have turned tedious for merchants to use. They need a more fast-paced, sought-after solution, or a third-party vendor that takes care of all their business transactions.

Enter payment service providers (PSPs).

PSPs are complete payments and banking platforms. They help merchants easily deal with their payments and banking needs including collecting money via payment gateways, making on-demand payouts to vendors, generating invoices, and everything in between. Many also enable merchants to accept international payments and take their business to the next level.

Related Read: Integrated Payment Systems

The top reasons why PSPs like Cashfree Payments are highly valuable for merchants rather than IMPS vs NEFT because they,

Handle all the necessary regulations such as PCI-DSS compliance etc. along with other legal formalities to ensure smooth transactions
Ensure each transaction is encrypted and processed through a layer of security to minimise the risk of fraudulent activities.
Handle recurring billing (subscription services) , payouts, and bulk transfers.
Offer multiple payment methods & currencies enabling you to widen your customer base and go international
Manage accounts and even gather insightful business information through their highly intuitive dashboards.

The Future Of Online Payments In India

The Indian payments industry has significantly evolved in the last couple of years. Many new, robust, and sought-after payment systems, especially cashless payments, have been introduced to the Indian market

The ongoing digital revolution is dramatically disrupting traditional banking services. The rise in Fintechs and their innovative solutions and methods to transact digitally are focusing merchants and individuals to make the shift. And why not? Initiatives and innovations like UPI, Payment links, QR codes, e-wallets, prepaid cards, etc. are easing the lives of everyone, especially the merchants.

That’s not all. The Indian Fintech sector is constantly engaged in finding more technologically advanced means to enhance the current payment systems and innovate new ones that usher an altogether different way people pay in the coming future.

Online payment systems are also redefining the payments experience through digital payment offerings. They’re trying to build personalised connections with customers, offer the best-in-class customer experience, and even collaborate pragmatically with banks and other service providers to open up more untapped revenue streams, especially for the merchants.

Currently, most payments solutions focus on offering real-time, low-value, high-volume, peer-to-peer payments, eCommerce, and mCommerce payment options. But, with more payment options being built by the Indian Fintech sectors, we’ll see many newer prospects take over the financial sector and make the entire ecosystem more streamlined and sought-after in the coming years.

Frequently Asked Questions on IMPS vs NEFT VS RTGS

Which is better, IMPS or NEFT?

IMPS and NEFT are two distinct money transfer methods. Which one’s better than the other depends on your fund transfer requirement. For instance, if you wish to transfer a large sum of money to a vendor that’s, let say, about ₹2,50,000, then NEFT should be your preferred mode of payment. Meanwhile, if you have to send a comparatively smaller amount to someone instantly, then IMPS is a better-suited option. Refer to the section above on ‘Difference between IMPS, NEFT, and RTGS,’ for more information.

Is IMPS transfer free?

IMPS charges largely depend on the amount being transferred along with the respective bank’s policies. In general, IMPS charges range from ₹2.50 to ₹25 for amounts falling between ₹10,000 and ₹5 lakh. However, many eminent banks have waived off the charges enabling customers to make transfers for free.

Is Google pay NEFT or IMPS?

GooglePay is neither NEFT nor IMPS. It’s a UPI or digital wallet platform developed by Google to enable people and businesses to make inter-bank fund transfers through their mobile phones.

What’s the best way to send money, UPI, IMPS, or NEFT?

Each payment system, whether UPI, IMPS, or NEFT, has its own distinctive usage. Which one’s better than the other ideally depends on the urgency and transaction amount. For instance, if you have to transfer an amount greater than ₹1 lakh, then NEFT is a faster and more effective mode of payment. Meanwhile, if you’re out purchasing household groceries, UPI will serve the purpose.

How many times can NEFT transactions be done in a day?

You can carry out as many NEFT transactions as you can till the time you exhaust the NEFT transfer limit for the particular day set by your bank.

In conclusion, understanding the differences between IMPS, NEFT, and RTGS can help you choose the best payment system for your needs. As financial technology continues to evolve, newer payment solutions like UPI and PSPs will offer even more flexibility, security, and speed. Whether you’re a business or an individual, these advancements are reshaping how you manage and transfer money in today’s digital world.