Online money transfer is emerging as a hot favourite when it comes to payments, data from the Institute for Development and Research in Banking (IDRBT), an apex arm of Reserve Bank of India, shows.

“There has been a tremendous increase in online transfers using National Electronic Fund Transfers (NEFT) and Real Time Gross Settlement (RTGS) systems,’’ AS Ramasastri, Director IDRBT, told BusinessLine here.

The Hyderabad-based institute plays a key role in electronic payments through these two systems and has a Structured Financial Messaging System (SFMS) hub. The latest data indicates that transaction volumes as well as value of transactions had almost doubled in just one year, Ramsastri said. For instance, NEFT transaction volume had increased from 392 million in 2012-13 to 665 million in 2013-14 while the value of transactions too had gone up from ₹22,727 million to ₹47,028 million in the same period. This growth is expected to increase in the current financial year. “Both the hub and settlement systems have sufficient headroom for business growth for next three years,’’ the director said. Its systems have also been upgraded to speed up transactions. The turnaround time for completing a transaction is as low as three seconds for RTGS and 17 minutes for NEFT.

Digital money

IDRBT is now working on a new concept of digital money. This would do away with physical transfer of cash from banks and financial institutions.

Three exclusive research labs have also been set up for mobile payments, analytics and information assurances. Banks could use these labs for research and innovation or developing new systems and products. Analytics in banking has been gaining importance. If specific patterns are identified, they will help in redefining customer relationship, fraud-detection and risk-mitigation, Ramasastri added.

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