What is the IMPS Full Form?
Launched in 2010, IMPS, Immediate Payment System was developed as yet another nuanced alternative to transfer funds interbank via payment gateways such as RTGS and NEFT, electronically, in real time, everytime and everywhere using multiple access channels such as mobile banking, netbanking, ATM, SMS and IVR.
Backed by the NCPI ( National Payments Corporation of India, and under the overall purview of the RBI, IMPS payment gateway can be availed by those banks and PPIs (prepaid payment instrument issuers) which have a valid licence from the RBI.
Currently 652 members live on the IMPS payment gateway which includes banks & PPIs. This channel is versatile, simple and quick as in addition to fund transfers, it can also be used to pay insurance premiums, utility bills, ticket charges, fees, online purchases etc.
Hope by now, you have understood the basic concept. So basically, the core objectives of introducing an alternative payment gateway was to:
Incentivise customers to use the mobile banking channel to transmit funds.
Infact, the mobile banking channel further democratised the pace of digital adoption of banking services due to wider reach of smartphones.
sides, this payment gateway is relatively simpler, as you only require the mobile number of the beneficiary and the bank generates a unique 7 digit MMID code.
Given the ease , speed, 24*7 availability,instant notification and safety of the transaction, it is no wonder that this channel has gained significant momentum especially over the last two years ( 2020-2022) with the number of monthly IMPS transactions rising from 248 million to 420 million.
Let us delve a bit deeper to understand the nuances of this payment gateway- the registration process, transaction fee, transaction timings, transaction amount limits etc.
All such transactions are chargeable and the fee differs from bank to bank. Typically, it ranges from ₹2.5 to ₹25+GST.
On the other hand, payments via RTGS or NEFT attract a fee when initiated from a bank branch.
- To begin with the sender or remitter has to register his account for mobile banking services at his bank branch.
- Consequently, the sender will receive a mobile money identifier (MMID) and MPIN from the bank which is a unique 7 digit code.
- Now download the application software for mobile banking on your smartphone.
- As nextstep steps, you need to register the beneficiary or the receiver.
- Link your mobile digits to the account in the respective bank.
- You will receive a mobile money identifier (MMID) from the bank.
- Now to transfer funds to beneficiary's account:
- Login to the mobile banking app and navigate to the menu ; else use the SMS facility, provided your bank provides the SMS services.
- Now get beneficiary mobile digits and MMID- 7 digit unique code.
- Key in beneficiary's mobile number, beneficiary MMID, amount and your MPIN and press ' send'
- On successful completion, that is when the amount is debited from the sender's account and credited to the beneficiary's account, you will receive a confirmation SMS.
- It is advisable to take note of the transaction reference code for any issues that may arise.
It is important to note that while earlier, both the remitter and the beneficiary were required to link their mobile numbers with their respective bank accounts and get MMID, in order to send or receive funds using IMPS, the platform was modified to include parameters such as account number and IFSC code or by using bank account linked Aadhaar, thereby further simplifying and democratising the payment channel.
It is also noteworthy, the credit risk related to insufficient fund balance is negated as such transactions are only fulfilled when the primary agency, NPCI routes the fund transfer to the beneficiary's account only after the remitting bank has debited the sender's customer account.
All IMPS transactions have a maximum threshold limit capped at ₹5 lakhs per day.
However, there is no daily minimum transaction amount.
All IMPS transactions are available 24*7*365. When compared to other payment gateway such as NEFT ( which is also available 24*7), the transaction process is faster, on a real time basis ; while NEFT is subject to a lag of about 2 hours.
Frequently Asked Questions (FAQs):
Q. Who are the key participants for IMPS?
For fulfilling an IMPS based fund transfer, the following participants are involved:
- Remitter (Sender)
- Beneficiary (Receiver)
- National Financial Switch - NPCI
Q. What details are required for IMPS fund transfer?
- IMPS account digits and IFS Code or mobile number and MMID of both the sender and receiver.
- In case of an ATM to channel, you need to validate through your ATM PIN.
Q. What are the key precautions to take as a customer to ensure safe and secured fund transfer through IMPS?
It is always good to follow these practices mentioned below to ensure safe fund transfers.
- Never share your debit card details such as card number, expiry date & CVV with anyone.
- Never share your one-time password ( OTP) with anyone.
- Never forward SMS to unfamiliar digits.
- Never share your net/mobile banking login password.
Q. Can IMPS service be availed offline?.
No, this service is only available online. However, other payment gateways such as NEFT or RTGS can be availed offline as well.
Q. What are the prerequisites for IMPS fund transfer?
You need to keep in mind the following while making use of this payment gateway.
- For starters, you need to have a mobile banking account which then has to be linked to an app through your mobile phone.
- Secondly, be extra cautious with regards to typing the beneficiary details such as the account number, amount etx. In case you make an error, the fund would be transferred to someone else's account . In such a case, you cannot retrieve or reverse the transaction until the beneficiary agrees to do so.
- Thirdly, you must ensure steady and uninterrupted net connection so that any potential lags and probability of submitting fund transfer requests more than once is minimised.
Q. What is the IMPS reference number?
The reference code is a twelve digit number provided by the bank and displayed on your screen as soon as you authenticate the payment via this channel. This reference code can also be located in your bank account statement against the transaction ID.
Q. Which primary agency manages the IMPS payment gateway?
This type of fund transfer is routed through the National Payments Corporation of India (NPCI) whereas RTGS and NEFT are operated by the Reserve Bank of India.
It is important to note that all these three fund transfer channels ( IMOS, RTGS, NEFT) are safe and secure and come under the purview of the Reserve Bank of India.