April 26, 2023

Money Transfer

Transferring funds electronically from one bank account to another, within and across geographic borders, quickly, safely and securely, for a whole host of reasons ( medical emergencies, vacation spends, shopping et al) is increasingly becoming the preferred channel in an increasingly digitised borderless world. Welcome to this concept of money transfer.
The transactions can be executed through different payment gateways and the selection of your preferred payment gateway would depend upon the following:
  • Threshold amount to be transaction
  • Time taken for the the transaction to complete.
  • Service charge levied by the financial entity.
  • Risk involved
  • Access to internet/mobile banking
  • Trackability of your transaction
  • Having the correct beneficiary details is important to complete the transfer.
  • Exchange rate incase of international money transfers.

Money transfer channels:

  • NEFT
    • RTGS
    • IMPS
    • Digital Wallet- Gpay, Phonepe,Paytm etc
    • UPI
    • Bank transfer
    • Transferring money via agents like MoneyGram, Payoneer etc.
    • Bank drafts
    • ChequeNEFT- Introduced in November 2005 by the RBI, it allows retail customers across India to transmit funds electronically from one bank branch-enabled account to either the same or any other bank within India. This service is available 24x7 ( with effect from Dec 16, 2019 as per RBI guidelines), every time, everywhere, everyone. Such transactions are settled on a near real-time basis, throughout the day. As per the RBI guidelines, there is no minimum daily threshold cash limit; customers can transmit an amount as low as ₹1 per day. Even with regard to the maximum threshold fund limit, the RBI has not pegged any figure.
RTGS- Real-time Gross Settlement ( RTGS) as the name indicates, is an RBI backed payment gateway wherein the settlement of payments occurs on real-time basis, with the amount being transferred to the payee's account within a span of 30 minutes from the initiation of payment. The faster processing time is also due to the settlement process, as the fund transfer amount is settled individually, on a gross basis, without netting, rather than in batches, as in the case of the NEFT The minimum threshold transaction amount is ₹2 lakh. On the other hand, there is no maximum limit on the transaction amount.
IMPS- The Immediate Payment Service was introduced in 2010 by NPCI. This real time, 24X7, economical, safe and secure, interbank electronic fund transfer service is available on multiple channels such as Mobile, Internet, ATM, SMS. Currently the IMPS ecosystem comprises 674 members, including banks & PPIs.
Digital Wallet- Gpay, Phonepe,Paytm etc In simple words, an e-wallet or digital wallet functions just like your physical wallet where money moves in and out to carry out various activities. The only difference is that in e-wallet, the cash exchange happens electronically. Fund transactions via digital wallets such as Gpay, Paytm, Phonepe, Amazon money, Jio money, Ola Money etc. can be accessed 24*7 and carry zero service charge.
UPI - or the Unified Payments Interface is a real-time payment gateway to transfer funds between two accounts which can be accessed via mobile device, anytime, anywhere. Developed and facilitated by National Payments Corporation of India (NPCI) in 2016, UPI supported a number of transactions such as inter-bank and peer-to-peer (P2P) person-to-merchant (P2M) transactions. The UPI ecosystem within India, currently registers~ 220 million transactions per day.
Bank transfer or wire transfer- Through this system, money is transferred across borders over the messaging protocol platform called SWIFT ( Society for worldwide interbank telecommunication network). It is a safe and secure channel for both inward and outward remittances.Typically, domestic wire transfers take a day while international wire transfers take five days or more.

Transferring money via agents like Western Union, MoneyGram, Payoneer etc.

Third party service providers like Western Union, MoneyGram, Payoneer etc. provide money transfer services through online and offline mode, inbound and outbound, through their exhaustive network of agents and offices across countries, worldwide.

You have two options to receive money

  • Cash - at an agent location
  • Direct credit to your account
These services are chargeable, the amount of which varies depending upon a variety of factors such as the sender's and beneficiary's location, the channel of transfer-offline or online, and the delivery time.

Some of the other online money transfer companies comprises

  • Transfast
  • Remitly
  • ICICI Money2India
  • Zenbanx
  • TransferWise
  • Axisremit
  • Remit2India
  • State Bank of India Money Transfer
  • RIA Money Transfer
  • WorldRemit
  • USForex
  • Indus Fast Remit
  • Xoom
  • Worldfirst
  • Moneycorp
Bank Draft- an alternative to physical cheques, Bank Draft , guarantees payment to the recipient. This channel of money transfer is typically used by international buyers or sellers who wish to guarantee the payment of funds.
Cheque- This is the traditional non-cash channel of transfering funds from the drawer's ( sender) account to the drawee's account ( receiver).

FAQs:

What are the potential risks for online money transfers?

Notwithstanding the layered security architecture deployed by financial entities to ensure safe and secure fund transfers, the online channel is subject to potential risk with regards to hacking of sensitive account related information, misuse of your password and login id by fraudsters etc.
Online money transfer is risky in

What is the consequence and remedial action to money transferred online to an erroneous account?

In such a scenario, you would have to forfeit your money. Therefore, it is extremely critical that you always type the correct credentials of the beneficiary.

Never miss a trading opportunity with Margin Trading Facility

Enjoy 2X leverage on over 900+ stocks

Upstox Margin Trading Facility
Apple Logo
Downloadlogo
iOS App
Google Play Logo
Downloadlogo
Android App

RELATED ARTICLES

Allahabad Bank Balance Enquiry Toll Free Number & How to Check by Missed Call & SMS

Allahabad Bank, one of the leading public sector banks in India was merged with and amalgamated into Indian Bank on 1st April 2020. It offers a range of services to its wide customer base both online and offline. You can carry out various functions such as transactions, balance enquiries, money transfers, etc. easily and conveniently. The following sections discuss the various ways of Allahabad Bank balance enquiry in detail.

Karur Vysya Bank (KVB) Netbanking - Login, Registrations, & Online Banking

Karur Vysya Bank ( KVB) is one of the oldest private sector banks in India. Established in 1916 and headquartered in Karur, Tamil Nadu, KVB has strong footprints in southern India with a branch network of 781 and an ATM network of 2251 ( as on June, 2021). With a total asset base of ₹116098, the bank provides a comprehensive portfolio of services, both offline and online to both retail ( Resident Indians, NRIs Hindu Undivided Families (HUFs) and corporate customers including Partnership firms.

RBI Increases Repo Rate & Exactly How Will it Impact You?

The Reserve Bank of India's decision to increase the repo rate has been making headlines lately. And as expected by many, the RBI Hikes repo rate has been increased by 25 basis points to 6.50%. In this article, we will discuss what happens if the RBI increases the repo rate and how the recent RBI interest rate hike in the repo rate by the RBI, makes an impact. Whether you are a borrower or a saver, it is essential to understand the implications of the rate hike and how it may affect your financial planning. So, let's look at the subject and understand what it means for you.

ICICI NEFT Form

The digital payment wave has swept the Indian banking ecosystem with the sheer rise in the volume of electronic payment transactions across channels such as mobile wallets, PoS terminals, UPI, IMPS!, NEFT, AEPS etc. Just to give you a perspective, the total yearly volume of digital payments across channels has increased from 14.59bn to 71.59bn in 2022, registering a staggering 4.9x rise in volume. Source:www.statista.com Clearly, the value proposition for digital banking customers is too good to ignore , given the speed, safety, seamlessness, of digital banking transaction Against this backdrop, the central regulatory authority, the RBI has outlined the next phase of growth 'Payment Vision 2025' based on the 4Es value proposition of digital banking- E-Payments for Everyone, Everywhere, Everytime. One such digital banking transaction/payment channel is the NEFT, National Electronic Funds Transfer. Introduced in November 2005 by the RBI, NEFT allows retail customers across India to transfer funds electronically from one NEFT bank branch enabled account to either the same or any other bank within India. The NEFT service is available 24x7 ( with effect from Dec 16, 2019 as per RBI guidelines). There is no need to visit the bank branch as NEFT transfers are made through digital channels (net banking and mobile banking) everytime, everywhere, everyone. Besides, the NEFT facility can also be availed for making credit card payments and for payment of loan EMI. For example, let us say you have an active account with ICICI Bank. You can make NEFT payment through the following channels. - Visit ICICI bank branch - Netbanking - iMobile Pay - m.icicibank.com - Pockets app - ICICI bankpay Founded in 1994, the Vadodara headquarters ICICI bank, is one of India's leading private sector player with a strong domestic and international presence through its network of 5,275 branches and 15,589 ATMs across India and footprints across 17 countries worldwide. The bank had consolidated asset base of ₹16.8 lakh crore (as on December 31, 2021). Let us take a deeper look at the nuances of NEFT transaction steps via digital payment channels such as netbanking and mobile banking. For starters, you need to add a beneficiary account details and always ensure that accounts of payee and beneficiary are in active state.