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Fund Transfer Systems in Banking Industry

There are two ways for transferring funds
RTGS (Real Time Gross Settlement)
NEFT (National Electronic Fund Transfer)


Real Time Gross Settlement (RTGS):
RTGS is nothing but transferring of money in real time on gross basis from one bank to other without netting. 
  • This RTGS is mainly used for large transactions, Minimum amount to be remitted through this RTGS is 2 Lakhs and there is no any upper limit.
  • Through RTGS system, money will be remitted for beneficiary account within 2 hours of receiving the fund transfer message.
  • Main advantage of fund transferring through RTGS is remitting bank will receive the conformation message from RBI that money have been transferred to beneficiary’s account.

Timings for Transferring Funds through RTGS:
  • Normal Days: 09:00 hours to 16:30 hours
  • Week Days: 09:00 hours to 14:00 hours

Processing/Service Charges for RTGS Fund Transfer
  • Inward Transactions: No Charge
  • Outward Transactions: Rs.2lakhs to Rs.5lakhs: Rs.30/-
  • Above Rs.5 lakhs: Rs.55/-


National Electronic Fund Transfer (NEFT)
NEFT is an electronic fund transfer system on DNS (Deferred Net Settlement) basis through netting. This NEFT will be done in 12 settlements.
Timings for Transferring Funds through NEFT:
  • Normal Days: 08:00 am to 07:00 pm
  • Week Days: 08:00 am to 01:00 pm


Indian Financial System Code (IFSC)
IFSC (Indian Financial System Code) is an alpha-numeric code that uniquely identifies bank branch participating in the NEFT system.
  • IFSC is an 11-digit code with the first four Alpha characters representing the bank, and the last 6characters representing the branch. The 5th character is 0 (Zero).


In this IFSC code SBHY0021221, SBHY represents bank name “State Bank of Hyderabad”, Last 6 digits 021221 is the branch code. Main aim of using this IFSC code is to identify the originating/destination banks and branches and also to route the messages to the concerned banks/branches appropriately.

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