NEFT Full Form

Having understood the NEFT Full Form, let us now learn about the features of NEFT.

•  The mode of funds transfer through NEFT was introduced by RBI in the year 2005.
• It is an electronic method of transferring funds from one bank to another bank.
• This mode of funds transfer primarily benefits business establishments and Corporate Companies where there will be a large number of funds transferred daily.
• Funds transfer through NEFT can either be done through net banking services or can be done by visiting the branch and filling up a request form.
• NEFT Full Form, i.e., National Electronic Funds Transfer, can be done round the clock and throughout the year.
• To complete the NEFT transaction, both the sender bank and the receiver bank should be NEFT enabled.
• NEFT gateway is monitored by RBI.
• The fund's transfers happen in batches and on an hourly basis.
• With this nationwide funds transfer facility, i.e., NEFT money transfer can be done to any nook and corner of the country.

Now that you are aware of NEFT full form, let’s understand more about the different ways of making a NEFT transaction. There are two ways of transferring funds through NEFT.

• By visiting the branch and filling up an NEFT request form: In this request form, you will have to provide the bank details and the name of the beneficiary. You should also give the details of the account that has to be debited.
• Through net banking: The procedure for NEFT through net banking is given below.
• Login to net banking with login credentials
• If the beneficiary is not on the list, you will have to add the beneficiary. You will have to give the name of the beneficiary, account number, IFSC Code of the bank for adding the beneficiary.
• Once the beneficiary is added, you will have to select the fund's transfer option.
• Choose NEFT under the fund's transfer option.
• Select the account number that has to be debited.
• Select the beneficiary from the beneficiary list.
• Enter the amount that has to be sent.
• Provide the purpose of the transfer.
• Click on confirm to complete the transaction.
• You will immediately get an acknowledgement with a reference number which you can either download in PDF form or can take a print.

The process involved in NEFT transactions from start to the fund's credit to the beneficiary account is as follows:

• The process begins with the request for funds transfer through NEFT raised by you either through the bank branch or through net banking.
• Immediately on initiation of NEFT, a message is created by the respective bank and sent to National Electronic Funds Transfer Centre.
• NEFT clearing Center operates under the supervision of RBI. The message received by NEFT Service Centre from the respective bank will be forwarded to NEFT Clearing Centre.
•  At the clearing centre, the NEFT transactions are sorted destination bank-wise, and the accounting entries, i.e., debit to sender and credit to receiver bank, is carried out.
•  After the accounting entries are complete, a remittance message will be sent by the respective NEFT Service Centre to the destination bank.
• The transaction is complete when an inward remittance message is sent to the destination banks by NEFT Clearing Centre. The beneficiary account will be credited immediately on receipt of the inward remittance message.

There are no timings as such for NEFT transactions. It can be done round the clock and all 365 days.  
The settlement, however, is done on an hourly basis and happens in batches. The transaction can be completed within 10 to 30 minutes. Sometimes it may even take 2 to 3 hours, depending on the NEFT traffic.

There are no specific restrictions for NEFT transactions. However, the NEFT transactions can happen only between banks that participate in NEFT Full Form, i.e., National Electronic Funds Transfer.  

The beneficiary should necessarily have a bank account. But the sender need not have a bank account. The sender can remit cash for NEFT transactions. The sender has to provide details like contact address, email ID and phone number if the remittance has to be through cash. Also, remittance through cash is limited to Rs. 50000/-

The following are the service charges:

• Upto Rs. 10000/- = Rs. 2.50 + GST
• Above Rs. 10000/- and upto Rs 1.00 lakh= Rs. 5.00 + GST
• Above Rs. 1.00 lakh and upto Rs. 2.00 lakhs= Rs. 15.00 + GST
• Above Rs. 2.00 lakhs= Rs. 25/- + GST

Now that you know the NEFT Full form and service charges, let us understand the benefits of NEFT[1] [2] :

• Physical presence is not required for the transaction. It can be done through net banking.
•  No exchange of physical instruments between the sender and the receiving banks.
•  Mitigates the threat of damage to the physical instrument, theft or forgery of the instrument.
• Very simple and does not involve much time.
• An acknowledgement vides an email notification or SMS will be received soon after the transaction is complete.
• It can be done from anywhere and at any time round the clock and on all 365 days.

The main reasons for the failure of NEFT transactions are:

•  The account number was mentioned wrongly.
• The account is either closed or frozen.

 If the transaction fails, then the amount will be recredited to the sender's account within 2 hours. If the sender has made the remittance through cash, then the recredited amount will be in the 'Suspense Account' of the respective bank.   
In such cases, the sender has to give a request in writing along with the acknowledgement given by the bank for having accepted the NEFT request to claim the amount.

Conclusion

Now that you are aware of the NEFT full form, how it works, the process involved in NEFT transactions, you can simplify the process of funds transfer. You will now be able to transfer funds to any corner of the country without having to visit the branch through NEFT. That means that funds transfer can be done at the comfort of your home or office at any time and anywhere round the clock and on all 365 days.