NEFT vs RTGS: Difference and Comparison

Electronic transfer of money is growing rapidly due to its speed, safety, simplicity, and ease with the progress of technology.


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Key Takeaways

  1. NEFT stands for National Electronic Funds Transfer, while RTGS stands for Real-Time Gross Settlement.
  2. NEFT is used for transferring funds up to a certain limit, while RTGS is used for transferring large sums of money in real time.
  3. NEFT settles transactions in batches, while RTGS settles transactions individually and in real time.


NEFT (National Electronic Funds Transfer) is a payment system utilized in India that enables individuals and businesses to transfer funds between banks electronically. RTGS (Real-Time Gross Settlement) is another payment system in India that allows for large-value real-time transactions.


Neft, also known as National Electronic Fund Transfer, is an online payment system. It lets the users transfer funds from one bank account to another.

RTGS is also known as Real-Time Gross Settlement. It is an electronic system that enables the transfer of funds in real time.

Comparison Table

Parameters of ComparisonNEFTRTGS
FunctionNEFT is an electronic system that enables the transfer of small to large sums of money across India.RTGS is an electronic system that allows the transfer of large sums of money in real-time.
Transfer limitIt requires a minimum transfer value of Rs 1.It requires a minimum transfer value of Rs 2 lakh.
SpeedIt can take up to around 12 hours to complete a transaction.In Rtgs, transactions happen within seconds. It is considered the fastest mode of transferring funds.
UsageIt is used for small transactions.It is used mainly for transactions that are of high value.
IntroductionIt was introduced in November 2005.It was introduced in March 2004.

What is NEFT?

 National Electronic Funds Transfer(NEFT) is an electronic system to facilitate the transfer of funds between two bank accounts.The process involved in the Neft transaction are: 

Step 1: Use your login ID and password to log in to your online bank account.

Step 2: Go to the Transfer Section of the NEFT Fund.

Step 3: Enter the recipient’s name, bank account, and IFSC code.

Step 4: Start an NEFT transfer after the beneficiary is successfully added. Enter the amount and send.

The only requirement is that the depositor and recipient bank accounts should support NEFT transfer. NEFT transfer can be made by an individual, a firm, or a company.

NEFT transactions offer several benefits. Some of them include

  • Electronic transfer of funds, i.e., physical presence, is not required
  • Simple and easy to use
  • Quick and efficient as payment confirmation can be received through SMS or email within minimal time.
  • Minimal to no chances of fraud as it is a highly secure method.

What is RTGS?

Real-Time Gross Settlement(RTGS) processes the transaction in real time. Requirements of RTGS transactions:

  • Bank account
  • Minimum transaction limit of Rs 2 lakh
  • Transactions should be processed within India

Transfer of funds through online mode requires no additional charges. RBI, in July 2019, waived all the charges in RTGS transactions. The process involved in RTGS transactions through online mode:

Step 1: Log in to net banking

Step 2: Add details of the recipient account

Step 3: Go to the Transfer tab of RTGS Funds

Step 4: Choose the required amount to be transferred

Step 5: Accept the terms mentioned 

Step 6: Send the online form for RTGS

Following the above-mentioned steps, it will enable the user to transfer funds hassle-free. RTGS transactions are managed by RBI, and hence once the transaction has been processed, it cannot be reversed.


Main Differences Between NEFT and RTGS

  1. NEFT is slower than RTGS as NEFT transactions happen in hourly batches as opposed to real-time basis.
  2. NEFT transactions operate 24*7, even on holidays, whereas RTGS transactions operate only during working hours.

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