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Akansha Jigyasu
11 hours ago Bank & Insurance

Big Bank Theory - Important Banking Terms : 2 (Banking/ Financial

Awareness)
In this article we will discuss about Important Banking Terms - 2. We have already
covered rst part of Important Banking Terms. We will now discuss some other
important banking terms in depth to help you all prepare for Banking Awareness in
a better way.Banking Awareness is a crucial segment of General Awareness.
Questions from Banking Awareness are asked in large number under General
Awareness section in almost all the bank exams. To help you all prepare for
Banking Awareness in a better way, we have started our series, Big Bank Theory.
This will help you in SBI PO Mains, NIACL Assistant, NICL AO as well as BOB PO
Manipal Exam.
Let us begin our discussion of Important terms used in the banking sector.

Big Bank Theory - Important Banking Terms : 2

NEFT

NEFT stands for National Electronic Fund Transfer.

This electronic payment system was introduced by Reserve Bank of India in
2005.
The transactions under NEFT are carried out in batches.
On Weekdays, the funds are settled from 8:00 AM to 7:00 PM in half hourly
batches. On Saturdays, funds are again settled in half hourly batches from
8:00 AM to 1:00 PM.
There is no minimum or maximum limit for the amount of funds that can be
transferred under NEFT. However, Rs. 50000/- is the maximum limit per
transaction.
The transferred amount is credit within 2 business hours in the account of the
beneciary after the transaction.
NEFT cannot be used for abroad transactions, however, under the Indo-Nepal
Remittance Facility Scheme, one can transfer funds to Nepal.
Service/ Processing charge is applicable for all outward NEFT transactions
and this facility can also be used by individuals who do not have a bank
account with the branch.
RTGS

RTGS stands for Real Time Gross Settlement.

As the name suggests, under RTGS, funds are transferred on real time unlike
the batch transaction of NEFT.
The minimum amount that can be transferred under RTGS is Rs. 2 lakhs.
There is no upper limit for the maximum amount that can be transferred under
this payment system.
On weekdays, transactions under RTGS can be made from 9:00 AM to 4:30
PM. For Saturdays, RTGS settlements can be made from 9:00 AM to 2:00 PM.
This timing may however vary as per the timing of the branch.
Under RTGS, the bank branch of the beneciary has to credit his/ her account
within 30 minutes of receiving the message for fund transfer.

IMPS

IMPS stands for Immediate Payment Service.

National Payments Corporation of India (NPCI) introduced IMPS facility in
November 2010 under the NFS (National Financial Switch) Network.
Under IMPS, funds can be transferred instantly and unlike NEFT and RTGS,
transaction through IMPS are available 24*7 (even on holidays).
The Mobile Banking Service of the bank should be approved by RBI in order
for them to be eligible for IMPS.

IFSC

IFSC stands for Indian Financial System Code.

This alphanumeric code is essential for transfer of funds electronically in
India.
IFSC code consists of 11 characters. Here, the rst 4 characters are alphabets
which represent name of bank. The fth character is 0. The last 6 characters,
which may be alphabet or numeric represent the bank branch.
NEFT and RTGS transactions use these IFSC codes in order to route the
transaction messages to the concerned banks.
The IFSC code acts as a unique identier of different bank branches in India,
since this system is applicable only for domestic transactions.

MICR

MICR stands for Magnetic Ink Character Recognition.

This character recognition technology is especially used in cheque clearing.
This characters of MICR code are printed with the help of magnetic ink or
toner, which are printed at the bottom of the cheque.
 MICR consists of a 9 digit numeric code. The rst 3 digits of MICR code
represent the code of the city. Bank code is represented by the next 3 digits.
The last three digit represent the code of the bank branch.

SWIFT

SWIFT stands for Society for Worldwide Interbank Financial

Telecommunication.
This is used especially for international transfer of funds between banks or
transfer of messages.
SWIFT code usually consists of 8 or 11 characters. The rst 4 characters of
the SWIFT code represent the code of the bank. The next two characters
represent the country code. The next two characters, which may be alphabet
or numeric represent the code of the location. The last three characters
represent the code of the branch.

Do let us know about more topics that you wish to study in the comments.
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Tags : Bank & Insurance SBI PO General Awareness

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Hari 5 hours ago

Thank u
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Jayprakash Singh 5 hours ago

Thanks mam
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Naveen Raj 5 hours ago

Very useful
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Kuldeep Yadav 5 hours ago

Thank you
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Amol Ghuge 4 hours ago

Thanks mam
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Naina 4 hours ago

Thank
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Kannan R 3 hours ago

Thank you.....
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Vaishali Shende 2 hours ago

thank u
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Vinoth 2 hours ago

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Neetu Sankhala 26 mins ago

Thanks mam.
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