NACH
Simplifying high-volume transactions for Businesses and Individuals
About NACH
NACH (National Automated Clearing House) offers a streamlined approach to handling high-volume, repetitive financial transactions. This electronic payment system enables collections of repetitive receivables like Utility bills (electricity/telephone/Mobile bills, credit cards, etc), Mutual Fund (SIP), Insurance Premium, Loan Instalments, credit card payments, payments of donations and other bill payments, making it an indispensable tool for businesses and individuals alike.
Key Features of NACH
Automated Transactions: Streamlines payments, reduces manual work.
High-Volume Handling: Efficiently manages large transactions.
Versatile Payment: Ideal for bills, loans, insurance, and more.
Time-Saving: Cuts effort for payers and payees, no manual repetition.
Increased Accuracy: Reduces errors in manual processing.
Enhanced Security: Features robust data protection protocols.
Easy Reconciliation: Simplifies financial management for businesses.
Wide Acceptance: Trusted by utility providers, financial institutions.
Flexible Scheduling: Timely payments for better cash flow.
Convenience: Enhances user satisfaction and loyalty.
Entity
Functions
Sponsor Bank (Equitas Bank)
Sponsor Bank is the bank which lodges NACH Transaction files for collection / distribution of funds on behalf of its Corporates registered for NACH services. In case of loan EMI, the Bank acts as User Institution as well as the Sponsor Bank.
Destination Bank (customer’s account holding bank)
A 'Destination Bank' is one that is responsible for the processing of Inward NACH transaction files.
NPCI
- Acts as an intermediary between the Sponsor and Destination Banks. It creates Utility Codes for the Corporates and communicates the same to the Sponsor Bank.
- Generates the unique mandate reference number (UMRN) for each of the registered mandates and sends it to the respective Destination Banks.
- Transaction file uploaded by the Destination Bank will be allocated to the respective Destination Bank for processing the transaction.
- Updates the Sponsor Bank with the transaction response upon completion of the transaction.
Mandate Holder
Customers of the corporate/user institution are required to fill up the mandatory details such as their Name, account no, bank name IFSC code, amount, tenure of transaction in the mandate and submit the same to the corporate / user institutions.
Institution User Code/Utility code
Utility Code / Institution User ID refers to the User Number that will be allocated by NPCI, to the Corporates.
Mandate
Mandate is a one-time registration process. It is just an authorization to the bankers to debit the account with a fixed amount or up to a certain limit as per the frequency given by the customer in mandate form.
UMRN
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.
Transaction files
These are files containing the transaction details along with the customer account details (name, account no, ifsc code) and the amount & period of transaction.
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