NACH Full Form is National Automated Clearing House
NACH stands for National Automated Clearing House and it is a new payment system introduced by NPCI which will be launched on 10th March 2019. It will allow users to make payments without any additional authentication apart from biometric verification or PIN code entry. NACH is not just another payment gateway but it is also an innovation in terms of security, convenience and speed of transactions because it offers all these features at one platform with no extra charges attached to the user’s account unlike other wallets where there are charges for every transaction done through them and henceforth this
The National Automated Clearing House is the full form of NACH in English. The NACH Full Form in Hindi is written as नेशनल ऑटोमेटेड क्लियरिंग हाउस. NACH was created by the National Payments Corporation of India (NPCI) to eliminate the need for two-factor authentication for electronic interbank transfers.
NACH is a scheme to facilitate electronic fund transfers within India.
It was introduced by the Reserve Bank of India in April 2001, and has been made mandatory since November 2002.
NACH stands for National Automated Clearing House, and facilitates the transfer of money between bank accounts. The system allows you to transfer funds using your mobile phone or debit card.
The following is the process for receiving NACH services:
- You can use E NACH services by going to the bank’s website and filling out a NACH mandate form. You will be redirected to the target bank’s website once you have completed the form.
- You’ll need to use your net banking credentials to authenticate your request.
- After that, the bank would check the account number and determine whether to approve or deny it.
- The mandate is verified if it is accepted, and further transactions can be planned. You’d be given a number called the UMRN (Unique Money Receipt Number).
Features and Benefits NACH Mandate
NACH’s mandate offers the following features and benefits:
1. The mandate for consumers is as follows:
A mandate is a legal requirement or command. It is the instruction that authorizes one party to make payments on your behalf. Mandates are authorized by you and can be used for recurring payments such as utility bills, insurance premiums, credit card payments, etc.
In case of NACH mandate, you have to give permission to your bank via net banking or using the mobile app for recurring transactions. Once you provide this permission, your bank will automatically debit the amount from your savings account at the chosen date and time without any further action from you.
2. The mandate for businesses is as follows:
- The online NACH mandate eliminates the need to process large amounts of cheque payments.
- It saves time because the approval period for sending money to a large group of people is small.
- Customer satisfaction is higher as a result of the ease with which bills can be paid.
- Better customer interactions as a result of speedier payment approval.
3. NACH-Providing Financial Institutions
NACH is a payment facility that is currently available from all major banks in the country. Axis Bank, HDFC Bank, Citibank, State Bank of India, ICICI Bank, RBL Bank, and others are among them.
NACH can be used to transfer funds from one account to another or from an account to a non-account holder. You do not need to have an internet banking facility with your bank for using this service.
NACH works on the same principle as NEFT and RTGS (Real Time Gross Settlement) — a customer has to authorise payment to another customer’s account by submitting a form called “NACH FORM” at any branch of the bank. This form contains details of both customers such as beneficiary name, IFSC code and account number along with other details such as amount, date and time of transaction etc.