Difference Between Internet Banking and NEFT

Edited by Diffzy | Updated on: April 30, 2023


Difference Between Internet Banking and NEFT

Why read @ Diffzy

Our articles are well-researched

We make unbiased comparisons

Our content is free to access

We are a one-stop platform for finding differences and comparisons

We compare similar terms in both tabular forms as well as in points


Terms relating to money transactions include NEFT and internet banking. These are the essential services that the developing banking industry offers to the public. National Electronic Fund Transfer is referred to as 'NEFT.' The "NEFT" electronic fund transfer system settles transactions in batches at predetermined times. The ability to make financial transactions using a secure website is known as net banking. Because the transactions are carried out online, it is often referred to as online or internet banking. We frequently need to move money from one account to another. The work has become quite simple with the development of new technology. Looking back, one might readily recall a lengthy line of people waiting at the bank for various reasons. Therefore, the developing banking industry offers two essential services: NEFT and Net banking.

Internet Banking Vs. NEFT

The main distinction between NEFT and Internet banking is that NEFT gives people who don't have bank accounts the ability to deposit money at NEFT-enabled departments with instructions to transfer funds using NEFT. Internet banking is much more convenient for customers because they don't need to go to the bank for many banking activities and can complete the task with just a few simple clicks while sitting at home. While NEFT is an electronic fund transfer system in which transactions are settled in assortments at specific times, Internet banking provides the ability to conduct financial transactions through a safe and secure website.

The user of internet banking can conduct financial transactions online. Additionally, it is known as web banking or online banking. Through this, one may carry out a simple money transfer, such as moving money between accounts and paying bills quickly and whenever it's convenient. The Reserve Bank of India supports NEFT, or National Electronic Funds Transfer, which was introduced in November 2005. It is a network that allows for the electronic transmission of money. The format was developed and is now maintained by the Institute for Development and Research in Banking Technology.

Difference Between Internet Banking And NEFT in Tabular Form

Parameters Of Comparison Internet Banking  NEFT
Description The "NEFT" electronic fund transfer system settles transactions in batches at predetermined times. The ability to make financial transactions using a secure website is known as net banking. Because the transactions are carried out online, it is often referred to as online or internet banking.
Quantity Within India, There is often no minimum amount. For example, under corporate internet banking, there is no upper limit. However, five lakh rupees is the maximum allowed for retail internet marketing. Varies
Applications Money can be electronically transferred between bank branches across the country to any individual, company, or organization that has an account there. All regular transactions, including stop-payment requests, balance inquiries, bill payments, and account transfers (depending upon the facilities provided by the bank under internet banking)
System of Money Transfer Typically requires up to 48 hours. Typically immediate
Classification Internet banking Mobile banking and online banking
Timeframes Bank's hours of operation Anytime
Vacation limitations Yes No
Coverage Transactions Across the Country International and National (depending upon the bank)

What Is Internet Banking?

A bank or other financial institution customer can conduct financial or non-financial activities online using internet banking, commonly referred to as net banking or online banking. Customers of this service have access to practically all banking services, including cash transfers, deposits, and online bill payments, that were previously only available through a local branch. Internet banking is available to everyone who has registered for online banking at the bank, has an active bank account, or has access to another financial institution. Clients who have registered for online banking services no longer need to visit the bank every time they need to utilize a banking service. It is not only a convenient or easy way to do banking but also safe. Net banking portals are secured by unique User/Customer IDs and passwords.

Unique Elements of Internet Banking

Some of the top benefits of online banking include:

  • Access to both financial and non-financial banking services is provided.
  • Availability of a 24/7 bank balance check
  • Pay the bills and transfer money to other accounts.
  • Check any mortgages, loans, and savings accounts connected to the bank account.
  • Safe and secure banking methods
  • Secured with a unique ID and password
  • Customers can request to receive a checkbook.
  • Invest in general insurance
  • Create or revoke standing orders and automatic recurring payments
  • Monitor any investments connected to the bank account.

Benefits of Online Banking

The following are some perks and advantages of Internet banking that are available to all users:

  • 24-7 accessibility: Unlike regular banking hours, internet banking is always available. All year long, it is accessible around the clock. In addition, the majority of internet services are not time-limited. As a result, users can access their bank balance, account statements, and financial transactions anytime.
  • The convenience of commencing financial transactions: Internet banking is favored mainly due to the ease with which fund transfers and bill payments may be made. All financial services are available to registered consumers without them visiting a bank or waiting in line. It is simple to conduct economic activities, such as bill payments and fund transfers between accounts, whenever it is most convenient and easy for the user.
  • Proper Transaction Tracking: After transactions with a high likelihood of being lost, the bank gives out acknowledgment slips. But with online banking, it's straightforward to track all the transactions a customer has started. The 'Transaction History' area of the website organizes transactions and fund transfers with additional information, including the payee's name, bank account number, the amount paid, the date and time of payment, and notes.
  • Quick and Secure: If two accounts are held at the same bank, net banking users can rapidly transfer money between them. The user may transfer money through NEFT, RTGS, or IMPS. Additionally, it is simple to pay taxes, EMIs, loans, and bills. A password and distinct User-ID are also used to safeguard the account and the transactions.
  • Non-financial Transactions: In addition to transferring money, internet banking enables users to access non-financial services like checking their account balance, reviewing their account statement, requesting the issuing of a checkbook, etc.

Different Fund Transfer Methods using Internet Banking

NEFT: One-to-one financial transfers are possible using the National Electronic Fund Transfer (NEFT) payment mechanism.

RTGS: A continuous money settlement on an order-by-order basis is known as Real-Time Gross Settlement (RTGS).

IMPS: The Immediate Payment System (IMPS) is a different real-time payment technique.

The Drawbacks of Online Banking

  • No matter how many steps banks take to maintain a secure network, online transactions are still vulnerable to hackers.
  • Internet connectivity is the only need for online banking. Hence it is a must. Any online service must be used with an active internet connection.
  • Password Security: Each online banking account has a password that must be supplied to access the services. The password is essential to preserving dependability.

What Is NEFT?

Customers may send money swiftly and securely between accounts thanks to National Electronic Fund Transfer. One of India's most well-known electronic cash transfer methods is offered to the public by banks. To operate, the National Electronic Fund Transfer uses DNS, or deferred net settlement, which settles transactions in batches. The payment only takes place at that specific moment. You may send money using this method in just a few minutes. This method of sending funds has no time restrictions because it is accessible 24/7/365.

NEFT Requires Specific Information

You must first add the person or organization to whom you wish to send money as a beneficiary before you may send money using NEFT banking. The following information is needed for NEFT:

The account holder's name that you wish to send money to

  • Customer number
  • Bank id
  • Named branches
  • IFSC branch code
  • Amount specifics

You must wait a few minutes or hours after adding a beneficiary for the bank to activate it. However, you can complete transactions as soon as it is active.

Features of NEFT include

  • Reduces effort and time.
  • Payments are made online.
  • Payments are made securely.
  • There isn't a transaction cost.
  • The money will be placed into the beneficiary's account within a few minutes.
  • Simply login into your net banking account allows you to complete a transaction. Your time and effort will be saved as a consequence.
  • The workplace is paperless.

Benefits of NEFT

  • It is efficient and safe, and NEFT makes it possible to send any amount of money quickly and without error via the Internet.
  • Low processing fees are necessary since NEFT offers a flexible method of payment. You may use this ability, which allows you to transfer any quantity of money without hassle and without having to pay the bank a sizable amount of money.
  • NEFT is a crucial component of Internet banking and a dependable means of receiving money and making payments online. It is safer to utilize this feature in India because most banks are synchronized to the requirements established by the RBI.
  • Rapid Settlement: NEFT transfers money rapidly using the standard banking transfer techniques, and it has the advantage of a quick account agreement.

NEFT and Internet Banking Drawbacks

  • Highly Technical - One of the main negatives of NEFT transfers in India is that they are a highly technical method of transferring money that is difficult for the average person to use. A person with limited computer and Internet knowledge could find managing an Internet banking account challenging.
  • Online payments include a certain amount of risk. However, if you're not using a secured browser, the information you are providing online might get passed on to a hacker. This is one of the most important and crucial reasons many countries don't believe in this facility. However, most Indian banks take proper steps to secure an NEFT transaction.

Main Difference Between Internet Banking And NEFT in Points

  • While NEFT is an electronic fund transfer system in which transactions are completed in batches at predetermined times, Net Banking is the ability to execute financial transactions over a secure website.
  • In contrast to NEFT, which sometimes requires up to 48 hours, money transfer systems in online banking are typically immediate.
  • While NEFT transactions are only conducted within the country, Internet banking offers coverage on a national and worldwide level.
  • While NEFT electronically transfers funds from any bank branch to any person, company, or organization with a bank account at any other branch nationwide, usage in internet banking is limited to routine transactions like account transfers, balance inquiries, bill payments, and stop-payment requests.
  • In contrast to NEFT, which has holiday limits, online banking has no such restrictions.
  • Customers may use it to view their bank accounts and conduct any necessary activities without physically visiting a financial institution's location. At the same time, it allows bank clients to send money directly between any two bank accounts that support NEFT via electronic messaging.
  • A bank charges Rs 20 for each financial transaction made through online banking and Rs 8.5 for each non-financial transaction. However, there are no fees for inward transactions in NEFT.
  • Timings For NEFT: Anytime, whereas for e-Banking, Bank business hours.


The user is given a user-id and a password by the banks that offer online banking services. Using these credentials, the user can access his account and utilize the bank's internet banking services. Thus, it is clear that electronic banking includes both NEFT and net banking. While net banking allows users to access their accounts and conduct transactions online, NEFT is utilized to move money inside the nation. In India, NEFT was launched by the RBI. Some banks do, however, also provide NEFT services through net banking.

In tandem with technological growth, the world is changing. People are finding it more convenient and easy to conduct financial transactions; we can now send money with a few simple clicks to loved ones anywhere around the globe. Due to technological improvements, clients now have a lot of things made more straightforward thanks to internet banking. NEFT and Internet banking both have a similar history and function for clients. However, because of ignorance, many individuals still need to learn how to use the Internet to send or receive money quickly.


  • https://www.bajajfinservmarkets.in/banking/what-is-neft.html


Cite this article

Use the citation below to add this article to your bibliography:



MLA Style Citation

"Difference Between Internet Banking and NEFT." Diffzy.com, 2023. Tue. 28 Nov. 2023. <https://www.diffzy.com/article/difference-between-internet-banking-and-neft-933>.

Edited by

Share this article