NACH Mandate Charges

NACH Charges Meaning

The NACH (National Automated Clearing House) mandate charge is levied by the NPCI (National Payments Corporation of India) to perform a transaction. Formulated by the RBI (Reserve Bank of India) to act as a centralised framework which allows repeated money transfers in bulk regardless of the geographical distances. NACH is useful for timely salary disbursal, EMI payments, auto-debit payments, pensions, subsidies, interests, dividends etc.

ON THIS PAGE : NACH Mandate Charges | Bank-wise NACH Charges | Where’s NACH Used? | FAQs 

What are the NACH Charges?

NPCI, or the National Payments Corporation of India, operates and monitors the NACH framework. NPCI charges a nominal amount from banks and financial organisations in lieu of the service. The charge depends on the transaction volume. In case of any changes to it, a circular is issued. The common charges levied by the NPCI are mentioned below. Do note that in the case of Income Tax refunds, NACH mandate charges are not applicable.

1) Processing Fee and Incentive for Credit Transactions (Direct Benefit Transfers (DBT)

In the case of Off-us transactions, the interchange of ₹0.25 will be passed on to the destination bank. The NPCI charges are ₹0.15 (off-us) and ₹0.15 (on-us). Charges are applicable irrespective of acceptance or rejection by the destination bank.

2) Processing Fee for Credit Transactions (Other than DBT)

In the case of Off-us transactions, the interchange of ₹0.25 will be passed on to the destination bank. The NPCI charges are ₹0.20 (off-us) and ₹0.05 (on-us). Charges are applicable irrespective of acceptance or rejection by the destination bank.

3) Processing Fee and Penalty on Debit Transactions

In case of Off-us transactions, the interchange of ₹0.50 will be passed on to the destination bank. The NPCI charges are ₹0.20 (off-us) and ₹0.05 (on-us). Charges are applicable irrespective of acceptance or rejection by the destination bank.

Penalty Amount

Applicable if the below-mentioned errors have occurred more than two times by the same bank.

4) Processing Fee, Incentive and Penalty on Mandate

The processing fee is applicable on initiation, cancellation as well as an amendment. The incentive is passed to the destination bank, and the penalty is passed on to the sponsor bank. The destination and the sponsor bank have to pay the processing fee to the NPCI. The details are mentioned below:

5) Processing Fee and Incentive for E-Mandate

The processing fee is applicable on initiation, cancellation as well as an amendment. The incentive is passed to the destination bank, and the penalty is passed on to the sponsor bank. The destination and the sponsor bank have to pay the processing fee to the NPCI. The details are mentioned below:

Some of the top banks offering NACH services are the State Bank of India, Citibank, HDFC Bank, ICICI Bank, etc.

What are the Bank-wise NACH Charges?

NACH bank charges depend on the bank’s terms of service and its agreement with NPCI. You can contact your bank and know the details. Some of the top banks offering NACH services are the State Bank of India (SBI), Citibank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, etc. The amount charged by these banks is listed below:

Where is NACH Used?

NACH is useful for individuals, corporations, the government sector, non-banking financial organisations, and banks. It reduces the time taken in processing money and settling bills and makes the process safer. NACH is used in the following scenarios:

• Mass Money Transfer: NACH mandate is a safe and traceable option for anyone who wants to make bulk transfers. The money gets processed real quick without the need for any tedious paperwork.

• Salary Disbursal: It's estimated that more than 70% of transactions today are conducted online. Companies are increasingly relying on the NACH mandate to transfer the monthly salaries of their staff.

• Enhanced Transparency: NACH has made money transfer and debits totally transparent and safe. Transactions occur within the NPCI firewall and you are notified about the transaction status at all times.

• EMI Auto-Debit: Individuals can get their monthly EMI amount auto-deducted from their bank accounts on a certain date.

• Instant Loans: Financial organisations that process loans online after quick document verification leverage NACH services the loan amount within 1-2 working days.

NACH is quite useful when it comes to the bulk processing of transactions. It saves time, effort, and paperwork, and the process is also highly secure and user-friendly. With the help of the NACH mandate, it’s become easier to avail loans online. If you are looking for a low-interest personal loan, then Bajaj Markets has got some attractive loan options by different lenders, with flexible repayment. You can also apply for a credit card on the portal from some of the top banks in the country.