The RBI has decided to allow round-the-clock fund transfers through NEFT from December this year in order to promote digital transactions.
The decision, the Reserve Bank of India said, “is expected to revolutionise the retail payments system of the country.”
Retail payment tool
Currently, the National Electronic Funds Transfer (NEFT) operated by the RBI as a retail payment system is available for customers from 8 am to 7 pm on all working days with the exception of second and fourth Saturdays of a month.
What is NEFT
The NEFT system is used for fund transfers up to Rs 2 lakh.
In its Payment System Vision 2021 document, the RBI had said that it will make available the NEFT system on a 24×7 basis from December 2019.
No charges on fund transfer
Earlier in its June policy, the RBI had done away with charges on fund transfers through RTGS and NEFT routes to boost digital transactions and asked banks to pass on the benefits to customers.
What is RTGS
The Real Time Gross Settlement System (RTGS) is meant for large-value instantaneous fund transfers.
Committee under constitution
Besides, a committee is already been set up, involving all stakeholders, under the Chairmanship of the Chief Executive Officer of Indian Bank’s Association (IBA), to examine the entire gamut of ATM charges and fees.