Why Pick Tech Over Cheques?

While our parents might disagree to this, the younger generation often resorts to tech for most of their transactions. And the biggest dilemma for someone considering the shift would be ‘where do I begin’ there are just so many ways to make payments ‘how do I decide?’

So to make things easier for you we’ve listed down factors for you to look at before deciding which to pick:

#1. The cost:

On comparing costs of issuing a cheque and DD with that of transferring money through net banking/mobile banking we found out that cheques would cost anywhere between Rs. 100-Rs.150, DD’s would cost anywhere between Rs. 25 to Rs.2000 depending on the bank and amount of transaction while netbanking/mobile banking would cost anywhere between Rs. 2.5 to only Rs. 50 depending on the bank and the amount. Also, some banks don’t even charge their customers for online fund transfers. That’s why the clear winner here would be netbanking/mobile banking.

As for digital wallets, there is no charge for adding money to your wallet from your bank account and no charge to transfer money to someone else. Although there is a charge of anywhere between 2%-4% of your transaction amount to add money from your wallet to your bank account. According to ET one of the reasons digital wallets don’t charge consumers for transactions is to attract more users and in the future, they might start charging.

Now that we’ve established that digital modes are way cheaper than cheques. Here’s what you should consider to decide when to pick netbanking and when to pick digital wallets:

#2. The amount of the transaction:

Ideally, most users use digital wallets for lesser value transactions and netbanking for bigger value transactions. Possible reasons for this is the safety aspect that banks offer if anything goes wrong. Not to say digital wallets aren’t safe, just that banks are safer! When you pay through a digital wallet you don’t have to enter all your bank details again and again, once it’s linked to your bank you just need to type in the OTP to make payments.

That’s why divide your payments between these two options for amounts above Rs. 10,000 stick to netbanking/mobile banking otherwise for lower amounts below Rs. 10,000 you can use digital wallets. And don’t forget digital wallets often give ‘cashbacks’.

When you transfer money through netbanking or mobile banking you’ll get an option to choose between RTGS, NEFT, and IMPS. These are nothing but payment systems which are used depending on the amount you want to transfer and the time you want your transaction to be complete in. 


#3. As you can see, if you wish to transfer funds through netbanking the transaction limits are:

  • Via: RTGS: A minimum of Rs. 2 lakh and a maximum of Rs. 10 lakh
  • Via NEFT: There’s no minimum or maximum limit on transfers through this system. Although some banks cap the maximum at Rs. 10 lakh.
  • Via IMPS: Minimum of Rs. 2 lakh per day
  • And if you wish to transfer funds through a digital wallet the transaction limit is Rs. 10,000 per month

#4. And the time it takes to transfer funds through netbanking:

  • Via RTGS it happens on a real-time basis i..e in around 30 minutes.
  • Via NEFT the transaction happens on the same day
  • And via IMPS and through digital wallets it happens Instantly

Now that you’ve got a rough idea of the costs, the transaction limits and the time it takes for the transaction to get completed you can decide which option to pick for which payment. 

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