If you have ever used the magical process of automating your bill payments, SIPS etc, you have used NACH services
Payment systems have evolved over years in India, One such program by the National Payments Corporation of India is NACH. NPCI – National Payments Corporation of India offers to Financial Institutions, Banks, Corporate and Government a Service which is called National Automated Clearing House i.e. NACH.
NACH aims at facilitating electronic Interbank High or Low Volume Debit/Credit transactions which are repetitive in nature.
There are two types of NACH Mandates
NACH – Debit
NACH Debit is used for collection of payments like Telephone bills, Mutual Funds – SIPS, Electricity bills etc.
NACH – Credit
NACH Credit is used to distribute Salaries, Dividend, and Interest etc.
In simple words, NACH Mandate is am authorization that consumers provide to Institutions to Credit or Debit funds. The Main Motive of NACH mandate is to facilitate funds transfer High or Low Volumes Electronically, the NACH Platform has 82000+ Banks linked giving it a huge national presence . NACH makes it easy for institutions to Credit Salaries, Dividends at once to large number if recipients, similarly facilitates them to also collect payments regularly from consumers
What is NACH Mandate Management System?
NACH Mandate management system is a service provided by NACH Debit to manage Debit mandates of Clients, It allows you to Manage, Amend and Cancellation of Payment mandates
Open an Account with Samco – India’s Leading Discount Broker
Why does the Samco Account opening KYC Form have a NACH Mandate?
The last page of the Samco Demat Account opening form has a NACH mandate along with details regarding the same. Samco collects a NACH authorization for clients for ease of debiting customers for the demat account maintenance charges and other such statutory obligations of the clients. This is done so that there is no manual follow up done with clients and no defaults on the account of the clients and thereby enabling uninterrupted service. Since the debits are recovered through the NACH mandate authorisation, the same are not debited to the ledger which may otherwise reduce the trading limits available to a client.
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Really Very nice post!!
Now eager to read your next post!!
I loved the way you discuss the topic great work thanks for the share.
Great post always sharing amazing content…. Keep it up.
What is required to avail nach debit service on behalf of a company , what is amount chargeble by NPCI?
What is UMRN in Mandate form ? how to fill it?
Dear Shweta, the UMRN is a Unique Mandate Reference number allocated to each new mandate created in NACH Debit. It is auto generated by the NACH system during mandate creation. UMRN is mandatory for every transaction and even during mandate amendment and cancellation.
We hope this resolves your queries. If you have any more queries or issues, feel free to contact us; we’re happy to help you. Thank you for your valuable time. Have a great day ahead!
Nach charges printed is RS 600 but as per current agreement it was 400. Please modify the same for further processing
Greetings! Thank you for getting in touch with us. The AMC (Annual Maintenance Charge) for every individual account is Rs.400 + GST/year. We’ve rounded off to the maximum amount, in case of any changes in government taxes. So even if the amount printed on the form is RS.600, it’s actually Rs.400 + GST. We hope this resolves your queries. If you have more queries, feel free to contact us. Thank you for your time. Have a great day!
what mean UMRN ?
Dear Sridharan, thank you for getting in touch with us. UMRN is a Unique Mandate Reference number allocated to each new mandate created in NACH Debit. It is auto generated by the NACH system during mandate creation. UMRN is mandatory for every transaction and even during mandate amendment and cancellation.
We hope this resolves your queries. If you have any more queries or issues, feel free to contact us; we’re happy to help you. Thank you for your valuable time. Have a great day ahead!
Thanks
Very nice
1- Is there any risk in authorizing the direct debit to a broking firm?
2- I mean,can they debit whenever and whatever amount they want to?
3- Is it mandatory?
4- It’s written Rs.50k in that form for debit (printed), what does that mean?
Please let me know.
Hi Indranil,
Thank you for your query, Firstly lets understand what is a mandate taken for ? A Mandate is taken for payments that you have to make regularly and it gives customers convenience of making these payments automatically by allowing an entity to debit a certain amount form your bank…
To answer your questions
1- Is there any risk in authorizing the direct debit to a broking firm?
No responsible broking firm will ever misuse the mandate, It always for a purpose like a SIP, Deducting AMCS etc. So you can provide a mandate to responsible brokers like us without any worry of unwanted transactions
2- I mean, can they debit whenever and whatever amount they want to?
That’s the function of a Mandate, it allows Mandate holder to deduct an amount from your bank, However, Money is always deducted against a SIP or a AMC charge that is agreed upon, We would never debit random amount of money from any customers bank account
3- Is it mandatory?
A mandate is done for convenience like explained before for recurring payments EMI, SIPS, AMC Charges that are recurring in nature and manually doing them is a task.
4- It’s written Rs.50k in that form for debit (printed), what does that mean?
Please let me know.
A Mandate of 50,000 meaning one can debit up to maximum 50,000 one time from your bank account, So for an example, if your SIP is Rs.10,000/ Month its always convenient to have a mandate of Rs.50,000 so next year when you increase the SIP amount you do not have to register a new mandate.
Please be rest assured that Mandate is NEVER misused, Incase you need more help please write to us on support@samco.in