IMPS is a quick and secure way of transferring funds between banks in real-time. Banks offer IMPS services to customers to facilitate the immediate transfer of funds. The RBI and NCPI ensure that the funds transferred through IMPS are secure and reach the beneficiary within minutes.

Explore what IMPS is, how it works, and the steps involved in using this revolutionary payment system to transfer funds effortlessly.

What is IMPS?

IMPS full form is Immediate Payment Service. IMPS facility allows customers to transfer funds immediately to a person or an account. IMPS means a real-time electronic fund transfer system designed for seamless and instant money transfers between bank accounts in India. 

Managed by the NPCI, IMPS empower individuals and businesses to send and receive money instantly through multiple channels, such as mobile banking, internet banking, ATMs, and bank branches.

This secure and efficient system enables users to make payments, pay bills, or transfer funds to loved ones anytime, anywhere. With its round-the-clock availability, IMPS has become the most convenient method for financial transactions.

How Does IMPS Work?

IMPS facilitates real-time electronic fund transfers in India. Here’s how IMPS transfers work:

• The sender initiates the IMPS transfer through their bank’s mobile app, internet banking portal, or SMS. 
• The transaction details are sent to the National Payments Corporation of India (NPCI) through the IMPS Switch.
• NPCI validates the account details and checks the sender’s account balance. It uses directory services to route the transaction request to the beneficiary’s bank.
• After the transaction is authenticated and forwarded, NPCI sends an authorisation request to the sender bank, informing it that the transfer can be made.
• The bank of the sender debits the amount from the account and records internally.
• NPCI clears and settles the process through coordination with the Reserve Bank of India (RBI). The beneficiary’s bank account is credited and the sender’s bank account is debited.
• The beneficiary’s bank receives a credit notification from NPCI and credits the amount to the beneficiary’s account.
• Both the beneficiary and the sender get confirmation messages of the IMPS transfer.

IMPS Example

Suppose you initiate an IMPS transaction of Rs. 1,50,000 lakh at 11:00 a.m. The transfer will be processed immediately, and the beneficiary will receive the funds within minutes (maybe by 11:10 a.m.).

IMPS Requirement

Here are the requirements to send money via IMPS::

For Remitter (To Send Money to Person):

• Mobile Money Identifier (MMID) of the beneficiary
• Mobile number of the beneficiary
• Name of the beneficiary
• MMID and MPIN of remitter

For Remitter (To Send Money to Account):

• Name of the beneficiary
• Account Number of the beneficiary
• IFS Code of the beneficiary bank

For the Beneficiary (Receiver): 

• MMID of beneficiary
• IMPS registration with bank

Ways of IMPS Transfer

IMPS provides a variety of methods for transferring money quickly and conveniently. Here is how you can leverage IMPS through different platforms:

IMPS via Mobile Banking or Internet Banking

• Log in to your bank’s mobile banking app or Internet banking portal with your credentials.
• Navigate to the ‘Fund Transfer’ section.
• Enter the beneficiary details, such as name, mobile number, bank account number or MMID and IFSC code.
• Select ‘IMPS’, enter the amount, verify the details and confirm using MPIN or OTP.

IMPS via SMS

• Some banks allow money transfers via SMS. Draft a text message using the specific format provided by your bank.
• Add the beneficiary’s MMID and the amount to be transferred.
• Send the SMS to the bank’s designated number for IMPS transactions.

How to Do IMPS Online?

Here is the process to do an IMPS transaction online:

• Visit your bank branch or use your bank’s mobile banking app to register for IMPS.
• Generate your MMID (Mobile Money Identifier) and mPIN (Mobile Banking PIN).
• Log in to your bank’s mobile banking app or Internet banking portal using your credentials. 
• Navigate to the ‘Fund Transfer’ section.
• Provide the beneficiary’s details, such as MMID and mobile number, account number and IFSC code (if applicable). 
• Select the ‘IMPS’ option, specify the amount to be transferred and check all transaction details.
• Enter your MPIN or OTP to authorise the transfer. 
• The IMPS system will instantly debit the amount from your account and credit it to the beneficiary’s account.
• You will receive a confirmation message with the transaction details. Save the confirmation message for your records or future reference.

How to Do IMPS Offline?

You can do an IMPS transfer offline by visiting a nearby ATM ob your bank branch. 

Follow this process to do IMPS through ATM:

• Visit the nearest ATM of your bank and insert/swipe your debit card into the machine.
• Enter your 6-digit ATM PIN and access the ATM menu.
• Navigate to the ‘Fund Transfer’ section in the ATM menu. Choose ‘IMPS’ to proceed with your transaction.
• Provide the beneficiary's details, including their mobile number and MMID or their account number and IFSC code.
• Enter the amount you wish to transfer and check all entered details.
• Click on the ‘Confirm’ or ‘Send’ button to complete the transfer.

Follow this process to do IMPS by visiting the bank branch:

• Go to the bank branch where you hold an account and request an IMPS transfer.
• Complete the IMPS form provided by the required details, such as beneficiary's name, account number, bank details, transfer amount and your account details.
• Submit the completed form along with the applicable IMPS transaction fee.
• The bank will process the transaction and provide a confirmation slip.

IMPS Form​

You can collect the IMPS form by visiting your bank branch. The forms of each bank may be different from each other. Here are the samples IndusInd IMPS form:

IMPS Charges

Here’s an overview of the IMPS charges of different Indian banks: 

IMPS Timings

IMPS transactions are 24x7, including public holidays and weekends. Some banks might limit IMPS timings (e.g., 8:00 a.m. to 8:00 p.m.) for transfers done through bank branches. 

IMPS Limit

The daily transaction limit is Rs. 5 lakh for IMPS transactions. However, banks set their own limits within NPCI guidelines.

Benefits of IMPS

• IMPS facilitates real-time fund transfers, crediting the recipient's account immediately.
• With IMPS, customers can send money at any time, 24x7, even on weekends and public holidays.
• IMPS is supported across different platforms, such as mobile banking applications, internet banking, ATMs, and even SMS-based services. This provides a smooth and user-friendly experience across different devices.
• Customers can send up to Rs. 5 lakh per day, which makes IMPS ideal for both personal and business transactions, including high-value transactions.
• IMPS is an economical choice, with minimal transaction charges usually between Rs.5 and Rs.15, subject to the bank.
• IMPS ensures security by using OTP-based authentication and encrypted communication. This protects financial transactions from fraud.
• IMPS avoids the sharing of complete bank account information. Transfers can be initiated with minimum information, such as a registered mobile number, MMID, or Aadhaar number.
• Remittances can be done through several modes, such as mobile banking platforms, internet banking, ATMs and SMS services.
• IMPS enables remittances internationally. Money can be remitted from overseas to an Indian account by money transfer service providers that have partnerships with Indian banks that provide IMPS facilities.

Challenges of IMPS

While IMPS is a real-time interbank electronic fund transfer system, it comes with certain challenges, which are as follows:

• IMPS transfers are limited to a maximum of Rs. 5 lakh per day, which can be inadequate for users who need higher-value transfers.
• Not all Indian banks are IMPS-enabled, restricting its use for users of non-participating banks.
• Technical issues or maintenance time may result in temporary inaccessibility of the IMPS service, resulting in inconvenience.
• IMPS works mainly through smartphones and internet sites, putting smartphone-less and internet-less users at a disadvantage.
• It takes a steady internet connection to use IMPS, which might become a constraint in remote or rural locations where connectivity is poor.

With ongoing technological advancements, IMPS (Immediate Payment Service) is set to become even simpler to use, scalable, and secure, allowing for wider use across all strata and helping India move ahead on the road to digital financial inclusion. The 24x7 facility enables users to make transactions at their convenience, getting around the shortfalls of payment systems such as NEFT and RTGS.