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Difference Between NEFT and UPI

NEFT is an abbreviation for "National Electronic Funds Transfer". The NEFT is a nation wide payment system facilitating one-to-one funds transfer. It operates on a deferred net settlement (DNS) basis and settles transactions in batches. The settlement takes place with all the transactions received before a certain cut-off time. NEFT is not available on the bank holidays, RBI holiday and Sunday.

UPI (Unified Payments Interface) is a payment system launched by National Payments Corporation of India. Using UPI, customer can pay directly from a bank account to different merchants, both online and offline, without the hassle of typing credit card details, IFSC code, or net banking/wallet passwords.

There are many differences between NEFT and UPI as listed in the following table which would help you choosing between the two:

NEFT Vs UPI

Basis of DifferenceNEFT (National Electronic Funds Transfer) UPI (Unified Payment Interface)
DefinitionThe system of electronically transfer of funds from one bank or bank branch to another bank or bank branch
Vs
The system of instant fund transfer between two bank accounts on the mobile platform
Fund Transfer Limit (Rs.)No Limit
Vs
1 Lakh per day
Required DeviceInternet, Website & Application
Vs
Internet & Smartphone
Information RequiredAccount Number & IFS Code
Vs
VPA of recipient & MPIN
Fund Transfer TimeUsually, on the same day
Vs
Instant
Fund Transfer to abroadYes
Vs
No
Beneficiary Registration
Required
Yes
Vs
No
24 X 7 Money TransferNo
Vs
Yes
Cost of Fund TransferRs. 2.50 to Rs. 25 plus taxes
Vs
Free
Alert sent after money
collection
No
Vs
Yes
Payment gateway
involvement
Yes
Vs
No
Banks offering payment
method
Almost all banks in India
Vs
21 Banks
E-Commerce transactionsYes, possible
Vs
Not possible