National Payments Corporation Of India (NPCI)

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National Payments Corporation of India

National Payments Corporation of India, is a umbrella organisation that aims at promoting and developing the payment infrastructure in India. The National Payments Corporation of India was founded in 2008, and it operates under the direction of both the Reserve Bank of India and Indian commercial bank. NPCI has as its primary objective to offer Indian businesses and consumers efficient, safe, and secure payment systems.

National Electronic Funds Transfer:

National Electronic Funds Transfer allows Indians to send money electronically from one bank or financial institution to another. NEFT, which is managed by National Payments Corporation of India, is a very popular way to transfer funds.

Availability:

  • NEFT is based on settlement. This means that transactions are processed at specified intervals in batches.
  • NEFT used to have specific operating hours and cut-offs, but starting Dec 2020 NEFT will be available 24 Hours a Day, 7 Days a Week. You can now initiate NEFT transactions at any time – even during weekends and holidays.

Transaction limit

  • The RBI does not set any limits for NEFT, however individual banks can.
  • It allows transfers of all sizes, from very small to extremely large.

Transaction fees

  • The amount of the transfer and bank can affect the transaction fees. Many banks no longer charge for NEFT transactions, particularly for transfers below a specified limit.

Transfer speed

  • NEFT runs in batches of every half hour , during normal business hours. Prior to this, it could have taken a few days or hours for transfers to be settled.
  • NEFT transfers are now possible in real time, and the money reaches the account of the beneficiary almost instantly, depending on which banks you use.

Security:

  • The NEFT transaction is highly secured, as it uses the encryption and verification protocols that are mandated by Reserve Bank of India.

How To Use NEFT

  • Bank Branches You can fill in a NEFT Form at a bank branch with details about the beneficiary, such as name, account number and IFSC Code.
  • Online Bank Most banks offer an online banking service that allows customers to send NEFT payments from home, office, via mobile applications, and other digital platforms.

How to use NEFT via online banking:

  • Access your online banking portal.
  • Go to the section titled ‘Fund Transfers’ or Payments.
  • Select NEFT for the transfer method.
  • Please enter the account information of your recipient (name, account code, IFSC, amount).
  • Check the details, and confirm your transaction.
  • Transfers are initiated in batches and then processed, the beneficiary receiving funds at the end of the settlement cycle.

Benefits of NEFT

  • Convenience : Send money without having to visit the bank.
  • Low-Cost is often cheaper than physical money transfers.
  • Security : High-security transaction system with multilayer authentication.
  • Coverage is available for all banks participating in India. This includes the vast majority.

Immediate payment service (IMPS)

Instant Payment Service (IMPS) is a real-time interbank money transfer system in India that allows for transfers to be made 24/7 including on holidays. The National Payments Corporation of India launched the initiative in 2010. It’s widely used to transfer money from one bank account to another via mobile phone, Internet banking or ATMs.

IMPS Features:

  • Unlike traditional payment methods such as NEFT which require payments to be made in batches, IMPS allows instant transfers of funds between accounts. The transaction is completed instantly and the money is credited to recipient’s bank account immediately.
  • IMPS, unlike many payment systems, is open 24/7, every day of the week. This includes holidays. It is a convenient way to transfer money.
  • Mobile banking : The most common way to access IMPS through mobile applications is via . A transaction can be initiated via SMS, mobile applications, or USSD code.
  • Online Banking IMPS can be accessed through the online banking system of your bank, allowing you to transfer money in real time.
  • ATMs Some banks offer IMPS transfers via ATMs. This allows customers to send money without Internet access.
  • IMPS allows fund transfers to be made using various identifiers, such as mobile number or IFSC codes.
  • The limit of IMPS can vary depending on which bank you are with, but in general it allows for transfers up to Rs 2 lakhs per person per day. There may be different limits set by some banks for internet and mobile banking.
  • IMPS may be widely used but some banks charge a small fee to make IMPS transfer. Fees vary depending on the bank and amount of money being sent.
  • IMPS validates transactions using a two-factor authentication system, like the MPIN (Mobile Banking PIN), to ensure that only users with authorization can make payments.
  • The transaction data is encrypted as well to ensure that sensitive information about the user remains protected.
  • IMPS integrates with the Unified Payments Interface, which means that UPI-based applications can process IMPS payment, making it easier and more efficient.

What IMPS Does:

  • Use your online or mobile banking to access the app.
  • Select IMPS for your payment option.
  • You can enter the details of the recipient, including the account number, IFSC or mobile number.
  • Depending on the platform, authentication can be performed using an MPIN or another method.
  • The transfer will be processed immediately and the credit to the account of the receiver is credited.
  • The transaction is confirmed by both the sender as well as the recipient.

Benefits of the IMPS

  1. Instant Payments: IMPS allows funds to be transferred instantly, making it ideal for payments that are urgent.
  2. Accessibility IMPS is accessible via mobile, Internet banking and ATMs.
  3. Convenience : This service is available 24/7 and allows you to send money at any time.
  4. Secure IMPS secures transactions with robust encryption, multi-factor authentication and other measures.
  5. Broad Coverage : This service is offered by a wide network of banks participating in India.

The Common Uses of the IMPS

  • Transfers from peer-to-peer: Quickly send money to family members, friends or acquaintances.
  • Bill Paying: Instantly pay bills such as utilities and mobile recharges.
  • Online Payment: Make payments to merchants and e-commerce platforms quickly.
  • Emergency payments: Ideal for transactions that require urgent payment, as IMPS operates around the clock.

WebLink

Unified Payments Interface:

Unified Payments Interface, a revolutionary real-time payments system created by National Payments Corporation of India. UPI was launched in 2016, and has since revolutionized the digital payment system in India. It allows users to instantly transfer money between accounts using smartphones or other devices.

UPI streamlines payment by integrating several bank accounts in a mobile app and allowing the user to instantly make payments between friends (P2P), merchants, and others using only their phone number and UPIID.

The UPI Features:

  • UPI is a fast, efficient way to transfer money between accounts. All payments are made in real-time, even on weekends and holidays.
  • The app allows users to link up multiple accounts, making it easier for them to make payments, receive funds, check balances and so on.
  • Payments can be made much more easily by using a UPI unique ID instead of bank account numbers and IFSC codes (e.g. user@bank). It is tied to both your bank account and mobile number.
  • Banks, merchants and e-commerce platforms as well as service providers accept UPI. UPI allows users to make payments in retail stores, pay their utility bills, send money, and pay online.
  • UPI has been designed to include security features such as Two-factor Authentication, (for instance, by entering a Pin) and Encrypted Data, which ensures that every transaction is secure.
  • The application also uses device authorization in order to verify that the user has been authorized.
  • UPI enables users to send and receive money from other UPI enabled banks.
  • UPI features include request and make payment. Users can, for example, request payment from other users or create payment links to businesses.
  • UPI allows seamless payment to service providers and merchants for everyday transactions, such as tax payments, shopping, paying utility bills, or even buying bus tickets.
  • UPI applications are available across multiple regional dialects, making them accessible to users throughout the country.

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