Before the RBI new rules on NACH, crediting salary was allowed only on working days. So, auto-debits are not permitted on bank holidays, Sundays, and even gazetted holidays. But After August 1, 2021, not only crediting salary and pension but also EMI, SIP payment, and Insurance premium done even on Sundays.
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What is NACH?.
National Payments Corporation of India(NPCI) operates the National Automated Clearing House(NACH). A NACH is an electronic payment service implemented for banks, financial institutions, Government departments, and corporates. The NACH has both credit and debit variants and uses for high-volume transactions that are repetitive and bulk.
NACH not only reduces the operational cost of the banks but also minimizes the workload. NACH improved as a famous and preferred mode of direct benefit transfer(DBT). With this only, the large government subsidy transactions are made quick and transparent during the present pandemic. In addition to ATM revised charges, these new rules on NACH were also made effective from Aug 2021.
Also read: ATM withdrawal charges increased!. Know the revised charges.
NACH Credit.
NACH Credit is an electronic payment service uses for providing credits to a large number of beneficiaries. Salary, pension, interest, and the payment of dividends performs through NACH credit against a single debit. The salary credited on every employee account on the same day from the same institute is a NACH credit. Done against a debit from an institute account.
NACH Debit.
NACH Debit is an electronic payment service for affording debits from a large number of accounts. Collection of repetitive payments such as loan EMIs, SIP, Insurance premium, gas, electricity, and water done through NACH debit. If you have taken a loan, then EMI debiting from your account every month automatically is a NACH debit.
RBI new rules on NACH.
In the Credit policy review of June 2021, the RBI governor informed about the availability of NACH for the convenience of people. So, from August 1, 2021, you can witness some changes in banking transactions because NACH will function 24*7. It is made possible only by the all-time availability of the RTGS facility. The RBI’s new rules on NACH make people more convenient and speed up the duration of salary processing.
