As of now, interbank funds transfer electronically is done through National Electronic Funds Transfer(NEFT). But issue with these transfers is the time lag as this is not a real time service and transactions are settled in batches. The other instant funds transfer service available in name of Real Time Gross Settlement (RTGS), but that has minimum transfer limit of 2 lakhs.
So RBI felt need for a real time and affordable fund transfer system to benefit the common man across the country (even to rural parts) and help their inclusion in country’s financial system. This will also reduce cash handling in country and RBI will have to print less currency notes.
There are more than 600 million mobile phone users in India, which is much higher than the no. of plastics used. In order to leverage technology which will not only lower costs of transactions but will also lead to ease in transaction by end users. So RBI felt need for a real time and affordable fund transfer system to benefit the common man across the country (even to rural parts) and help their inclusion in country’s financial system. This will also reduce cash handling in country and RBI will have to print less currency notes.
What is Interbank Mobile Payment Service (IMPS)
Interbank Mobile Payment Service (IMPS) is an instant interbank electronic fund transfer service through mobile phones. IMPS facilitates customers to use mobile instruments as a channel for accessing their banks accounts and remitting funds therefrom. Various banks are providing remittance facility through their mobile banking platforms. The interbank remittance request initiated from a mobile is processed by the beneficiary bank as a National Electronic Fund Transfer (NEFT) transaction. The status of such payment request is therefore not known instantly because NEFT payments are processed in batches from 9 am to 7 pm. The NEFT transactions are charged by banks and charges vary from bank to bank.
Benefits of IMPS
The account of the receiver is credited instantly.
Allows sender to send money to the mobile number of the beneficiary.
The beneficiary doesn't need to disclose his or her account and other financial critical details to the sender .
Comparatively easy for a beneficiary to communicate his or her mobile number to the sender.
Simple and easy to use
Safe and secure
Does not need computer or internet. Works even by sending SMS.
Currently the IMPS service has been with 7 banks. That means customer can transfer amounts between accounts present in these banks:
Axis Bank
State Bank of India
Bank of India
Union Bank of India
ICICI Bank Ltd
Yes Bank
HDFC Bank
How does IMPS work
Step 1: Remitter sends instruction from his/her mobile through his/her bank provided application or SMS.
Step 2: Remitting bank validates the details of the remitter and debits his/ her account. This transaction is sent by the remitting bank to NPCI.
Step 3: Transaction is passed by NPCI to the beneficiary bank. Beneficiary Bank validates the details of the beneficiary customer, credits the account, sends confirmation NPCI about transaction status and sends a sms to the beneficiary customer informing him of the credit.
Step 4: NPCI sends the transaction status to remitting bank which in turn informs the status of the transaction to the Remitter.
Step 5: Remitting bank send a sms confirmation of the transaction to the remitting customer.
How to Send Money through IMPS
Register the beneficiary details first
Funds transfer -> Add Beneficiary -> Register beneficiary -> IMPS
Enter the mobile number and MMID of the receiver
Transfer funds through IMPS
Funds transfer -> IMPS -> Enter the amount
How to receive money through IMPS
The customer has to register for SMS Banking( if not registered already)
The customer has to inform the sender his/her registered mobile number and MMID
The beneficiary details required by the sender are:
Beneficiary's mobile number. The beneficiary's mobile number should be registered with his bank. MMID of the beneficiary customer. Mobile Money Identifier (MMID) is a seven digit random number issued by the bank upon registration. Remitter (customer who wants to send money) and Beneficiary (customer who wants to receive the money) should have this MMID for doing this interbank funds transfer.
What is MMID
Mobile Money Identifier (MMID) is a seven digit random number issued by the bank upon registration. Remitter (customer who wants to send money) and Beneficiary (customer who wants to receive the money) should have this MMID for doing this interbank funds transfer. MMID is unique to each bank account.
Charges
Presently Free
The charges for remittance through IMPS are decided by the individual banks. Please contact your bank for the details.
Limit on the value of transactions in IMPS?
The limit is defined by RBI in the Mobile Payment Guidelines issued to banks. The customer can transact on IMPS subject to a daily cap of Rs. 50,000/- per customer overall for transactions through mobile for the funds transfer. Transactions up to Rs. 1000/- can be facilitated by banks without end-to-end encryption.
