Bulk payment system to be available on all week days
- The service, used for recurring payments by consumers and direct subsidy transfers by the government, has so far been operational only on bank working days.
The bulk payment system under the National Automated Clearing House (NACH) will be available on all days of the week from August 1, the Reserve Bank of India (RBI) said on Friday.
The service, used for recurring payments by consumers and direct subsidy transfers by the government, has so far been operational only on bank working days.
Operated by the National Payments Corp. of India, NACH facilitates one-to-many credit transfers such as payment of dividend, interest, salary and pension as well as the collection of payments pertaining to electricity, gas, telephone, instalments towards loans, investments in mutual funds and insurance premium.
“The RBI has taken successive steps over many years to ensure that digital payment options are available every day, every hour, and this is yet another step in that direction,” said Adhil Shetty, chief executive at BankBazaar.com, a financial services marketplace.
The RBI said NACH has emerged as a popular and prominent digital mode of direct benefit transfer to a large number of beneficiaries.
“This has helped transfer of government subsidies during Covid-19 in a timely and transparent manner. In the interest of customer convenience, and to take advantage of the availability of Real Time Gross Settlement (RTGS) on all days of the year, it is proposed to make available NACH on all days of the week throughout the year, effective August 1,” it said.
In May, NACH was used for 406.6 million debit and credit transactions, showed RBI data.
“The finance and banking industry will benefit from this, and so will the millions of beneficiaries of NACH,” said Rajesh Mirjankar, MD and CEO at fintech solution provider InfrasoftTech.
In addition, NACH availability on all days will now enable industries to leverage electronic payment modes to a greater extent. It is also imperative to note that digital payments will be more impactful when all electronic payment modes are made available on all days, he added.