What is NACH: National Payments Corporation of India (NPCI) has introduced in a new scheme which is going to start on May 1st 2016. The new scheme is called NACH. NACH means National Automated Clearing House. It is web based solution and it is used make interbank electronic transactions.
Now with this web based solutions banks financial and government institutions can make transactions in bulk. Bulk transactions include distribution of subsidies, dividends, interest, salaries pension etc. This NACH is also helpful in making regular activities like utility bill payments like telephone bills, electricity bills, Credit card bills, Mutual Fund SIP investments, Insurance premiums etc.
This scheme is launched to merge multiple ECS Systems (Electronic clearing service system) which are running across the country. National Payments Corporation of India (NPCI) is providing this NACH in two ways NACH Debit & NACH Credit.
NACH is mandatory and will replace any other ECS format namely Local ECS Regional ECS and National ECS. This NACH will help the Government and Government recognized agencies to make its Aadhaar linked payments to implement Direct Based Transfers (DBT) schemes like MNREGA, LPG subsidy, old age pension, social security pension etc.
NACH Features and Application Form Instructions:
- NACH will allows its participating banks to design their products for their corporate needs.
- There is no limitation for NACH registrations. So the banks can register as many times as possible.
- This NACH will provide high secure standards to enable quick and reliable transactions.
- The default NACH mandate will be up to 31/12/2099.
- You can cancel the form at any point of time.
- NACH has well set management system.
- This registration will takes only 15 days.
- NACH registration will give unique mandate registration reference number for future reference.
- Payment settlement done within the same day.
- Main feature of NACH is it avoids high interchange fees of credit card fees.
Instructions to be followed when your filling NACH Application form
- You have to fill all the mandatory fields which are in the form.
- Do the signature properly.
- Mention the correct Bank account number and folio number.
- And you should know whether your investor bank participating in NACH otherwise form will be rejected.
NOTE: NACH Application Form will be rejected If the signature is mismatched and if the provided bank account number, folio number are incorrect.
For more information about NACH: http://www.npci.org.in/clearing.aspx