Digitization has paved the way for net banking and mobile banking, which have revolutionized the banking industry. An initiative by the Government of India in 2010 for a unique identification number for every citizen after capturing and storing their biometric values resulted in an Aadhaar card with a 12-digit number. An Aadhaar gives access to various services offered by banks, other than the benefits offered by the government.
Some online services such as eSign and eStamp paper are Aadhaar-based, and along with these, you have eMandate introduced by the National Payment Corporation of India (NPCI). A mandate, also known as National Automated Clearing House (NACH), involves interbank high volume, low-value electronic transfers, which are periodic and repetitive in nature.
What is eNACH?
Called electronic National Automated Clearing House, eNACH is an improvement over the NACH, and facilitates interbank high volume, low-value electronic transfers, which are periodic and repetitive in nature on the Internet. It removes most of the processes you undergo in NACH. There is no need to fill out a form, while logistics and human interactions are limited. It takes just a few hours to complete and activate the process.
How to Register for eNACH?
Individuals can automate their recurring payments of periodic nature using eNACH by integrating it into their existing system. The steps explained shows how to register eNACH to help a customer, who avails a secured loan like a home loan on a condition to repay in equated monthly instalments (EMI).
Step 1: Check if you are eligible for eNACH
You are eligible for eNACH registration if you have an active Internet banking facility or debit card of a particular bank, which accepts net banking, as well as a debit card as a payment method. If you do not have it, you can apply for the same at the nearest branch of that specific bank.
Step 2: Initiating eMandate
For initiating eMandate, you have to contact your bank either in person or over phone. The customer service representative at the bank will help you request for the eNACH registration by filling in the details such as the name of the account holder, email address or mobile number, start date and end date of EMI payment, amount type, frequency of payment, maximum amount to be debited, LAN (16-digit alpha numeric), customer bank account number, and name of the bank.
You should also confirm whether you want to opt for the EMI payment through net banking or debit card. The completed form is sent after authentication by your bank (the destination bank) to the sponsor bank.
Step 3: Receive an email and SMS
The next step in the eNACH registration process is receiving an email and SMS on your registered email address and mobile number requesting you to register for eNACH by clicking on the link provided. The link will be valid for 10 days.
Step 4: Verification and authentication by the customer
You will have to click on the link given to take you to the eNACH preview page. In case you have chosen the payment mode through net banking, you will find all the Mandate and generic details mentioned earlier, including your PAN number for verification. After verifying the details, you need to confirm it by clicking on the ‘Confirm’ tab. It will show you the bank authentication page confirming all the above details, including the bank name, account number and mandate amount.
Next, you have to confirm the details and verify the OTP sent to your registered mobile number. On registering for eNACH, a nominal amount will be debited from your account to confirm the registration. You will receive the transaction details confirming the eMandate.
The authentication process for the debit card is also similar, except that you need to verify the debit card number, PIN and expiry date provided. Finally, you will receive an acknowledgment for eNACH registration for the repayment of your loan.