Role of RBI in Digital Banking An Overview of the NEFT Mechanism

NEFT -RBI Frequently asked questions| Major Update

• System: National Electronic Funds Transfer (NEFT).
• Proprietor: Reserve bank of India (RBI)
• Availability: 24/7/365, half hourly settlement batches.
• Covers: Pan-India, all major banks and branches.

Operational Features

• Mode: Electronic, credit-push type (only sender initiates)
• Access: Internet/Mobile banking, no visit to branch is required.
• Confirmation: This is an SMS/Email confirmation sent to remitter after credit.
• None of the charges as imposed by RBI and no charges imposed on internet NEFT on savings customers.

Uses:

• Account-to-account fund transfer.
• Credit card bill payments
• Loan EMIs
• Inward foreign remittances
• Remittances to Nepal through INRF (Indo-Nepal Remittance Facility).

Transfer Requirements

• Name of beneficiary, Bank, Branch, Account Number, IFSC.
• LEI (Legal Entity Identifier) obligatory on large-value entities.
• Branch charges (Offline NEFT)
• Amount    Charges (Excl. GST)
  • Up to ₹10,000    ₹2.50
  • ₹10,001 – ₹1 lakh    ₹5
  • ₹1 – ₹2 lakh    ₹15
  • Above ₹2 lakh    ₹25
• There is no transfer limit by RBI- internal limits that may be imposed by banks.
• Cash remittance had a limit of 50,000 per transaction.

Account Types & Compliance

• Allows under FEMA regulations NRE/NRO accounts.
• Only to Nepal, outbound remittance.

IFSC Code Structure

• 11 characters:
• First 4 → Bank Code
• 5th → ‘0’
• Last 6 → Branch Code

Transaction & Grievance

• Credit Period: Within 2 hours of settlement.
• Delay Compensation: Repo Rate + 2%
• Misplaced Account Entry: It is the responsibility of Sender.
• Tracking: Via UTR via NEFT Customer Facilitation Centre.
• Complaints: RBI Integrated Ombudsman(RB-IOS 2021) → cms.rbi.org.in / 14448.