Let us get one thing clear. Without IFSC code there is absolutely no way you can do an online transfer. In case of IFSC there are two ways you can transfer money. If you are an individual transferring money to someone or another entity (like a shopping company) you can use the NEFT called as the National Electronic Funds Transfer.
The NEFT has no minimum amount limit and you can start sending from 1paisa onwards and there is no limit on the maximum amount you can transfer as well. However, there might be some restrictions from the Bank. Most banks only allow you to transfer close to rupees 50,000 or have limits based on the type of account you hold. The charges for NEFT are as follows and applies only to the person who sends the money:
- For NEFT transactions till Rs 10,000 : not exceeding Rs 2.50 (+ Service Tax)
- For NEFT transactions till 10,000 up to Rs 1 lakh: not exceeding Rs 5 (+ Service Tax)
- For NEFT transactions more than Rs 1 lakh and up to Rs 2 lakhs: not exceeding Rs 15 (+ Service Tax)
- For NEFT transactions more than Rs 2 lakhs: not exceeding Rs 25 (+ Service Tax)
On the other hand you have the RTGS for business people which means Real Time Gross Settlement. It is mostly suited to business people where the money transfer is instant and has to be sent to the recipient by at least 30 minutes if not immediately. Unlike NEFT where the banks process in a batch process or bulk transactions, RTGS is an individual money transfer and the banks have to act upon it immediately.
The charges for RTGS are up to rupees 30 per transaction for amounts from 2 lakh to 5 lakhs and 55 rupees for transactions above 5 lakhs.
However, you must note that the RTGS and NEFT transactions are applicable only in an Indian Bank Scenario. What do you do when you need to send money online for your cousin in the States or buy that iPhone from a shopping site in the UK? Yes, this is where PayPal, a third party payment system comes in place. The best part is PayPal does not charge any fees for individuals who are making a purchase or receiving money. The charges are very nominal which is 4.4% + $0.30 USD per sale or transaction or lower.
Also once you have registered as a PayPal user you have to just enter the NEFT code once and after that every time you can make a purchase or send money to someone. You need not update the details repeatedly.
PayPal is an online payment system and therefore requires NEFT code which is an alphanumeric code of the bank account you hold. Just make sure that the NEFT code and the account number entered by you is correct. In case of any wrong transaction either while buying or selling, PayPal charges you a penalty of 250 rupees. So make sure you are absolutely right while updating your details.
After you have entered the bank account details, PayPal will also send you a small amount on your bank account and you have to verify your PayPal account by entering the amount you received.
On the IFSC code update from the leading banks in India, Axis Bank IFSC code is available for all the 36 states in India, Bank of India IFSC code is available for 35 states and the Allahabad Bank IFSC code is now available for 32 states.
