Salary Delayed Due To Bank Holidays? Soon, EMI Payments & Salary To Be Processed Round The Clock

From August 1, the RBI will make the National Automated Clearing House facility available round the clock, and is aimed at facilitating high-volume, repetitive and periodic e-transactions.

New Delhi: Many times our monthly installments either got delayed by a day or debited before time if the payment happens to fall over the weekend or banking holidays. But it is going to change soon.

It is because coming August, the RBI will make the National Automated Clearing House (NACH) facility available round the clock. The National Payments Corporation of India has implemented the NACH platform to facilitate high-volume, repetitive and periodic e-transactions.

How is the NACH platform going to impact payments?

Most of the employers are using NACH to transfer salaries, and automatic EMI repayment of loans, also takes place through this platform, as per the business publication Mint. Moreover, governments, corporates, and banks use the system to distribute subsidies, dividends, interest, salary, and pension. It is used to collect bill payments, loans, investments in mutual funds, and insurance premiums.

While explaining the benefits of the system to the business publication Mint, Sanjeev Srivastav, chief risk officer, IIFL Finance, said the lender can send payment requests on the due date including a bank holiday. Such a move will help customers plan their finances better if payments are deducted on time. For instance in case of auto-debit for a credit card, the customer won’t miss the due date because of holidays.

Besides this, firms using the technology for debt recovery and delinquency management will help them to determine customers’ repayment behaviour.

Experts also believe that the change in the NACH system will increase the processing time for systematic investment plan (SIP) registration and also offer better investor. As pf now, it takes two to three weeks to register SIPs through NACH which also depends on the investor’s bank, with some smaller banks or nationalized banks taking longer for registration.

Apart from increasing the volume of collections, the extended time will also control the bounce rate for loans being repaid through NACH mandates.