Fund Transfer through NEFT
Nationwide electronic transfer means electronically operated mode of fund transfer by the individuals, firms or corporates involved into reciprocation of funds. RBI has issued a system for the banks and its customers to make speedy transaction. When two entities exchange some products or services, the financial transaction has got to happen. Keeping in mind the massive amount work that needs to be handled every day, RBI determined to use NEFT, a mode for transferring fund electronically.
NEFT stands for National Electronic Funds Transfer which is an nation-wide account to account funds transfer system. Using NEFT, individuals, corporate, and firms can electronically make transfer of fund from any bank branch to any individual, or firm or corporate with an account in any other bank branch anywhere in the country.
The NEFT-operating entities can spread out their wings up to any location of the country. There is no specific limit to its expansion or extending its territory of network. RBI itself allows the banks to widen their network or the number of branches. Through NEFT there is no room for fraudulent encashment. There are manifold benefits of core-banking system which embrace NEFT system as part of banking solution. The remitter does not have to dispatch a cheque or demand draft to the beneficiary. There is no need to deposit documents or even visit his bank. The remittance proves the most affordable transaction. The remitter gets confirmation through SMS or email. All the transactions can be effected from his residence or workplace using internet banking interface.
IFSC or Indian financial system code has been provided by RBI to make transaction using NEFT. IFSC code which is found on RBI website identifies a certain branch of a bank. This code can also be enlisted from the bank branch where the entity has its account. And before making any financial transaction, this IFSC code is required.
The beneficiary is supposed to get credit for the first nine batches in business hours (i.e., transactions hours from 9 am to 5 pm) and the initial four batches on Saturdays (i.e., transactions from 9 am to 12 noon) on the same day. For transactions settled in the last two batches on week days (i.e., transactions settled in the 6 and 7 pm batches) and the last batch on Saturdays (i.e., transactions handled in the 1 pm batch) beneficiaries can expect to get credit either on the same day or on the next working day morning (depending on the type of facility enjoyed by the beneficiary with his bank).
After successful crediting of the amount to the beneficiary’s account, the bank where transaction took place is expected to send a confirmation to the originating customer or a remitter via SMS or e-mail along with date and time of transaction. At the time of transaction, the remitter must forward mobile number / e-mail-id to the branch.
The pre-requisite for fund transfer through NEFT need to be taken into consideration. Both originating bank and the destination bank should be NEFT-enabled. The remitter should carry details like name, account number, and the account type, and IFSC code at the time of transaction. For Net Banking customers, some banks have the facility to automatically pop-up IFSC code, once the name of the destination bank and the branch bank have been chosen.