Want to send money instantly? These are its 3 advantages
Sending money to a person is no longer the time consuming process that it was earlier. With the revolution in digital banking, using cheques to transfer money has become obsolete. There are many different ways to transfer money online these days with some modes transferring funds instantly from one account to the other. These are the different ways how to transfer money online:
• National Electronic Fund Transfer (NEFT):
Under NEFT, transfers are executed electronically within a couple of hours. For NEFT, the beneficiary has to be added to the bank’s authorized third party transfer list. NEFT transactions are settled by banks at intervals of time which means if the transaction is authorized by the customer, it is in queue till the next settlement period.
• Real Time Gross Settlement (RTGS):
RTGS transactions are settled by the RBI. These transactions are settled immediately and on one to one basis. A minimum amount of Rs. 2,00,000 per transaction is required for RTGS.
• Unified Payments Interface (UPI):
Under UPI, payment is made using the UPI ID of the person as compared to the bank details. UPI is processed using the IMPS network which means this transfer can be done 24*7.
• Immediate Payment Service (IMPS):
IMPS uses the mobile number of the customer to make a payment using the mobile number and a special ID. IMPS can be done 24*7.
These modes of fund transfer allow a customer to send money online instantly. Here are the advantages of this type of fund transfer:
1. Convenience and guarantee of payment:
One of the best advantages of sending money online is the convenience that it offers. The administrative work involved with paying via cash or cheque is completely eliminated because of online payments. Instant online payments also almost always get credited to the recipient’s bank account immediately, thus providing a guarantee of payment.
2. Secure:
Online payments are a secure way of making payments. Modes like RTGS are backed by the RBI. Most fund transfers are initiated after double checks from the customer, thus ensuring that the transaction can be cancelled. However, transactions like RTGS, UPI and IMPS instantly debit the bank account which is why the user should exercise caution about the accounts the funds are transferred to.
3. Economical:
One of the reasons to send money online instantly is the low costs. At the moment, UPI transactions are free of cost. NEFT and RTGS transactions depend on the value of the transaction but range between Rs. 5 and Rs. 50 per transaction. IMPS charges range between Rs. 2.5 to Rs. 15 per transaction. These charges are nominal as compared to the convenience offered of instant fund transfer.