NEFT Electronic Fund Transfer FAQ

 

Q.1.
What is NEFT System?

 

Ans
National Electronic Funds Transfer (NEFT) system is a nation wide funds
transfer system to facilitate transfer of funds from any bank branch to any
other bank branch.

 

Q.
2. Are all bank branches in the system
part of the funds transfer network?

                       
 

Ans
No. As on June 10, 2008, 44,731 branches of 85 banks are participating.
Steps are being taken to widen the coverage both in terms of banks and branches.

 

Q.3.
Whether the system is centre specific or has any geographical
restriction?

 

Ans
No, there is no restriction of centres or of any geographical area within the
country. The system uses the concept of centralised accounting and the bank's
account at one centre (viz, Mumbai ) gets operated for the funds transfer
instructions that are being sent or received. The individual branches
participating in NEFT could be located anywhere across the country, as detailed
in the list provided on our website.

 

Q.4.
What is the funds availability schedule for the beneficiary?

 

Ans
The beneficiary gets the credit on
the same Day or the next Day depending on the time of settlement.

 

Q.5.
How does the NEFT system operate?

 

Step-1:
The remitter fills in the NEFT Application form giving the particulars of the
beneficiary (bank-branch, beneficiary's name, account type and account number)
and authorises the branch to remit the specified amount to the beneficiary by
raising a debit to the remitter's account. (This can also be done by using net
banking services offered by some of the banks.).

 

Step-2: The remitting branch prepares a Structured
Financial message  (SFMS message)
and sends it to its Service Centre for NEFT.

 

Step-3:
The Service Centre forwards the same to the RBI NEFT centre (National Clearing
Cell, Mumbai) to be included for the next available settlement. Presently, NEFT
is settled in six batches at 0930, 1030, 1200, 1300,
1500 and 1600 hours on weekdays and 0930, 1030 and 1200 hours on Saturdays

Step-4:
The RBI at the NEFT centre sorts the transactions bank-wise and prepares
accounting entries of net debit or credit for passing on to the banks
participating in the system. Thereafter, bank-wise remittance messages are
transmitted to banks.

 

Step-5:
The receiving banks process the remittance messages received from RBI and afford
credit to the beneficiaries' accounts.

 

Q.6.
How is this NEFT System an improvement over the existing RBI-EFT System?

 

Ans
The RBI-EFT system is limited to the 15 RBI centres providing the facility,
whereas there is no such restriction in NEFT as it is based on centralised
concept. The detailed list of branches of various banks participating in NEFT
system is available on our website. The system also uses the state-of-the-art
technology for the communication, security etc. and thereby offers means of
providing better customer service.

 

Q.7.
How is it different from RTGS and EFT?

 

Ans:
NEFT is an electronic payment system to transfer funds from any part of country
to any other part of the country and works on deferred net settlement, unlike
RTGS that works on gross settlement. EFT is also a deferred net settlement
system but is restricted to the fifteen RBI centers.

 

Q.8.
Any limit on the amount of individual transaction?

 

Ans
There is no value limit for individual transactions.

 

Q.9.
What about Processing Charges/Service Charges

 

Ans
While RBI has waived the processing charges till March 31, 2009. Levy of service
charges by banks is left to the discretion of the respective banks. The
bank-wise details of charges levied are available on the RBI website.

 

Q.10.
How I will know which are the branches participating in the NEFT?

 

Ans
RBI publishes the list of bank branches participating in the NEFT on its website
i.e. www.rbi.org.in .

 

 

 

Q.11.
What is IFS Code (IFSC)? How it is different from MICR code?

 

Ans
Indian Financial System Code (IFSC) is an alpha numeric code designed to
uniquely identify the bank-branches in India. This is 11 digit code with first 4
characters representing the banks code, the next character reserved as control
character (Presently 0 appears in the fifth position) and remaining 6 characters
to identify the branch. The MICR code has 9 digits to identify the bank-branch. 

 

Q.12.
How I will know, what is the IFS Code of my bank-branch?

 

Ans
RBI has advised all the banks to print IFSC on cheque leaves issued to their
customers. You may also contact your bank-branch and get the IFS Code of that
branch.

 

Q.13.
Whom I can contact, in case of non-credit or delay in credit to the
beneficiary account?

 

Ans
Contact your bank / branch. If the issue is not resolved satisfactorily, the NCC,
Nariman Point of RBI may be contacted on nefthelpdeskncc@rbi.org.in
or write to -

 

The
General Manager,

Reserve
Bank of India,

National
Clearing Centre,

1st
Floor, Free Press House, Nariman Point,

Mumbai-400027.

 

 

Q.14.
Is it necessary to have a bank account to originate the NEFT transaction?

 

Ans
Yes, NEFT is an account to account funds transfer system. However, facilities
exist to accommodate walk-in customers to remit funds through NEFT up to
Rs.50,000/-.

 

Q.15.
Is it necessary that the beneficiary should have an account at the
destination bank-branch?

 

Ans
Yes, NEFT is an account to account funds transfer system.

 

Q.16.
Can I receive foreign remittances through NEFT?

 

Ans
This system can be used only for remitting Indian Rupee among the
participating banks within the country.  However,
foreign inward rupee remittances can be routed among the participating banks
within the country through the NEFT system.

 

Q.17.
Can I send remittances abroad using the NEFT?

 

Ans
No.

 

Q.18.
Can I originate a transaction to receive funds from another account?

 

Ans
No

 

 

Q.19.
Can I send/receive funds from/to NRI accounts?

 

Ans:
Yes, subject to applicability of provisions of FEMA

 

Q.20.
Would the customer receive an acknowledgement of money credited to the
beneficiary?

 

Ans:
No; However, electronic acknowledgement is generated for the remitting bank for
receipt of funds by the receiving bank.

 

Q.21.
Would the remitting customer get back the money if it is not credited to the
beneficiary’s account?

 

Ans:
Yes, the remitting customer gets back the money if it is not credited to the
beneficiary account.

 

Q.22.
Till what time NEFT service window is available?

 

Ans:
There are six settlements at 0930, 1030, 1200, 1300, 1500 and 1600 hours on
weekdays and 0930, 1030 and 1200 hours on Saturdays.

 

Q.23.
What is the essential information that the remitting customer would have
to furnish for the remittance to be effected?

 

Ans:
The essential information that the remitting customer has to furnish is:

 

·       
Beneficiary details
such as beneficiary name and account number

·       
Name and IFSC of the
beneficiary bank branch.

 

Q.24.
Is there any way a remitting customer can track the remittance transaction?

 

Ans:
The remitting customer can track the remitting transaction through the remitting
branch only, as the remitting branch is informed about the status of the
remitted transactions.