The world of banks has changed much within the last few years with digital technology. Amongst the popular electronic payment methods that have reached the top rung are National Electronic Fund Transfer or NEFT and Real Time Gross Settlement, or RTGS. This is a comparison of NEFT and RTGS that can be compared so as to know them better on how they work and what benefits they can render to businesses, especially the merchant account holders.
What Are NEFT and RTGS?
Primarily, both NEFT and RTGS conduction facilitate the smooth and effective transfer of funds between different banks across India. Nonetheless, the mechanisms of their operations contrast significantly, thereby implying a fundamental NEFT and RTGS difference.
NEFT: Hourly Batches for Smaller Transfers
NEFT operates in hourly batches and processes transactions throughout its operational hours, while RTGS provides real-time fund transfers. The minimum transfer limit is ₹1 for NEFT, but for RTGS, it is ₹2 lakhs. Hence, RTGS is more suitable for high-value transactions, while NEFT is ideal for lesser value transactions.
Choosing Between NEFT and RTGS for Businesses
Businesses with a merchant account, i.e., special types of accounts that allow businesses to accept payments in multiple ways, should carefully choose between NEFT and RTGS based on the fund transfer efficiency, transaction limit, and timing needs.
A merchant account also aids in streamlining operations, building trust with vendors, and maintaining customer satisfaction. The choice between using NEFT or RTGS transactions can make significant changes in the way these accounts operate, depending on the scale of the business transactions.
In recent times, kindred to NEFT and RTGS, another significant development in digital payments has been United Payment Interface (UPI) services, with several players like Bajaj Pay entering the market.
Bajaj Pay UPI, part of the Bajaj Finserv Group, is surprisingly convenient, safe, and flexible to use for individuals and businesses alike. It allows users to consolidate multiple banking features, seamless fund routing, and merchant payments into one platform.
Using Bajaj Pay UPI is uncomplicated and stress-free. Here’s how:
1. Download the Bajaj Finserv Wallet app from iOS or Android and proceed with the registration.
2. Post registration, choose ‘UPI’ from the menu and choose ‘create a new virtual payment address (VPA)’.
3. Post VPA creation, set the MPIN by providing debit card details.
4. Once the MPIN is set, link the VPA to your bank account to facilitate transactions.
5. Once completed, you can start enjoying the simplicity, security, and functionality of Bajaj Pay UPI, including the convenience of instant transactions.
Conclusion
In conclusion, while exploring the NEFT and RTGS difference, the crucial influencing factors are the transaction necessities, nature of transactions (whether high or low value), and the real-time or non-real-time preference. For a business with a merchant account, these electronic payment modes help by expanding the business’s customer base, reducing the handling of cash, improving cash flow, and enhancing overall service speed. On the other hand, for casual transactions made easier, Bajaj Pay UPI stands as the popular convenient choice with an easy-to-use interface and seamless transactions.
