IMPS is one of the most used way of transferring money in India despite that many people still do not understand it. They know it works, but not how or when it’s better than NEFT.
What is IMPS ?
IMPS is a real-time bank transfer system that let you send money instantly from one bank account to another that is 24×7, including Sundays and bank holidays.
- As you send money the receiver gets it within seconds
- There’s no waiting for bank hours or settlement windows
Unlike older systems where money moves in batches, IMPS works transaction by transaction, which makes it fast and immediate.
We can say, IMPS is the instant messaging version of money transfer, while older systems like NEFT are more like scheduled emails.
What is the Full Form of IMPS
IMPS stands for Immediate Payment Service.
The name itself explains the core principle:
- Immediate → No delay
- Payment → Actual fund transfer, not a request
- Service → Available across banks through a central system
IMPS is operated by NPCI (National Payments Corporation of India), the same organization who is behind UPI, RuPay, and FASTag.
What is IMPS Transfer in Banking
An IMPS transfer is when money moves directly from your bank account to another bank account in real time, using one of the following combinations:
- Account Number + IFSC
- Mobile Number + MMID (older method)
- In some cases, net banking or mobile banking authentication
Unlike wallets or prepaid balances, IMPS always involves actual bank accounts on both sides.
- IMPS is push-based (you send money)
- It is final (once sent, it cannot be reversed easily)
That’s why banks treat IMPS as a high-confidence, high-speed rail for funds.
How IMPS Transaction Works
IMPS may look simple from outside, but internally it has proper technical steps.
Here’s what actually happens behind the scenes:
- A person with bank account initiate the transfer
- Through mobile banking, net banking, Atm or bank,
- Entering recipient account number, IFSC code and amount
- Your bank verifies
- Details provided by you
- Balance availability
- Authentication (PIN / OTP)
- NPCI system processes the request
- Acts as a central traffic controller
- Matches sender and receiver banks instantly
- Receiver bank credits the amount
- Account is credited immediately as NPCI initiate the fund
- Confirmation sent back to sender, via receiver’s bank to NPCI and then to sender’s bank.
- You get confirmation through
- SMS / app notification
- Unique transaction reference number
This entire cycle usually completes within seconds not even minutes. Unlike NEFT, there is no batch processing, which is the key reason behind IMPS instant transfer.
How Much Time IMPS Takes
- Usually takes 5–30 seconds
- Maximum (rare cases): 1–2 minutes
- Worst case (network or server issues): Pending → auto-reversal
IMPS does not depend on bank’s working hours, it works the same on Sundays, midnights and even on holidays.
If an IMPS transaction fails:
- Amount is usually auto-reversed
- Reversal time can range from few minutes to 24 hours
Due to its speed, IMPS is often used as a backup system even when UPI fails.
IMPS vs NEFT: Which Is Faster
If we consider speed as the only factor, IMPS clearly wins.
NEFT works on a settlement cycle, meaning transactions are processed in groups at fixed intervals meanwhile IMPS works individually and instantly.
- IMPS is for urgency
- NEFT is for planned and large amount transfers
People often assume NEFT is outdated but actually it’s not. It is designed for different use cases.
Difference Between IMPS and NEFT
| Feature | IMPS | NEFT |
| Transfer Speed | Instant (seconds) | Delayed (batch-based) |
| Availability | 24×7 | 24×7 (but not instant) |
| Settlement | Real-time | Deferred |
| Ideal Use | Emergency & quick transfers | Scheduled or large transfers |
| Confirmation | Immediate | After settlement |
| Reversal Risk | Low | Very low |
| User Experience | Fast, decisive | Slower, predictable |
The key difference is timing and amount. With IMPS, you know the money is there instantly but for large amount NEFT is more safe.
When Should You Use IMPS
IMPS is best used when time matters more than cost.
Common real-life situations:
- Paying rent at the last minute
- Sending money to family in an emergency
- Paying a seller who requires instant confirmation
- Transferring funds between your own bank accounts quickly
- Backup option when UPI is down or unstable
IMPS is not always the cheapest, but it is often the most reliable under pressure.
Is IMPS Safe
Yes, IMPS is considered highly secure, but safety depends on how you use it.
Security layers include:
- Bank-level authentication (OTP / PIN)
- Encrypted messaging between banks
- NPCI-controlled switching
- Unique transaction reference for every transfer
However, IMPS has one important characteristic i.e., Transactions are hard to reverse
Which means:
- Entering wrong account details can be costly
- Scams involving urgency often misuse IMPS
Best practices:
- Double-check account numbers and IFSC
- Avoid sending IMPS to unknown people
- Never rush just because someone pressures you
IMPS is safe technically, but requires human caution.
Common IMPS Charges & Limits
IMPS is usually not free, though charges vary by bank.
Typical IMPS charges :
- Small amounts: Low or zero charge
- Medium amounts: Nominal fee
- Higher amounts: Slightly higher fee
Banks may also apply:
- Daily IMPS transaction limits
- Per-transaction caps
- Separate limits for mobile and net banking
Important note:
- Charges are usually shown before confirmation
- Many banks waive IMPS fees for savings accounts or digital users
Always check your bank’s latest IMPS pricing as it is bank-controlled, not fixed by NPCI.
IMPS Is Quietly Powerful
IMPS doesn’t get the hype that UPI gets. In IMPS there are no QR codes, no catchy sounds, no daily reminders. But IMPS is the system banks themselves rely on.
It is:
- Fast without being flashy
- Reliable without being complicated
- Old enough to be stable, modern enough to be relevant
Understanding IMPS isn’t just about knowing another payment method, it’s about knowing which financial tool to use when.