It is used for electronic payment applications like National Electronic Funds Transfer (NEFT), Real Time Gross Settlement (RTGS) and Centralised Funds Management System (CFMS) developed by Reserve Bank of India (RBI). IFSC Code has eleven characters "Alpha Numeric" in nature. First four characters represent bank, fifth character is default "0" left for future use and last six characters represent branch.
National Electronic Funds Transfer (NEFT) is a nation-wide system that facilitates everyone to electronically transfer funds from an account of any bank branch to any account with any other bank branch in the country. NEFT transfers are also referred as e-cheques as the funds are not transferred in real-time and the funds are settled in batches.
Real Time Gross Settlement (RTGS), which can be defined as the continuous (real-time) settlement of funds transfers individually on an order by order basis. You need the IFSC Code of the branch to identify the Branch for which you want to transfer the funds using RTGS. Note all branches don't have IFSC Codes.
Immediate Payment Service ('IMPS') is commonly known as Interbank Mobile Payment Service. IMPS uses IFSC codes to identify the bank branch and offer a number of fund transfer services instantly in a round the clock environment. National Payments Corporation of India (NPCI) is an organization that regulates the retail payments in India has provided this facility.