eMandate

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What is eMandate?

eMandate is a digital payment service initiated by RBI and the National Payments Corporation of India (NPCI). It serves as an underlying infrastructure for businesses in India to collect recurring payments without any human intervention.

eMandates allow you to provide standing instructions to your bank and other institutions to auto-debit a specific amount from your bank account. The convenience of this process ensures timely payouts without any delays or missed payments. You can easily manage recurring payments like insurance premiums, SIPs, loan repayments, etc. It eliminates the stress of scheduling payment reminders and helps you avoid incurring any penalty charges.

Until recently, the mandate was only available offline, but the online process has proved more convenient for customers. With these details on an eMandate, read more about the advantages and eligibility.

What are the Advantages of eMandate?

Since its inception, eMandate has added 30+ banks and introduced real-time authorisation confirmation. Furthermore, it has helped multiple industries accept the recurring business model. You can enjoy the following benefits of eMandate at registered financial institutions in India.

1. Continuous Cash flow

eMandate can significantly reduce the friction of customers logging in and out of portals to make payments. Businesses can ensure a steady cash flow by automatically deducting payments from the source.

2. Attracts New Customers

With eMandates providing businesses with better access to cash flow, there’s less need to pursue rogue customers or send out late payment reminders. It allows companies to maintain relations with existing customers and focus on acquiring new ones.

3. Increased Customer Retention

By offering the benefits of a one-time digital authentication, customers can experience uninterrupted services. It reduces negative encounters with collection agents and boosts customer retention and loyalty. Incidentally, this contributes to attracting more customers to your business.

4. Promotes Transparency

Since all eMandate based transactions are online, they offer more transparency between businesses and their customers. Furthermore, with no additional/hidden charges included, companies receive a boost of credibility.

5. Reduces friction in payments:

eMandate payment processes offer a great deal of flexibility to both businesses and customers. Here, businesses can hold off on certain debits, if necessary, and customers can block any unwelcome payments.

These advantages of eMandate allow businesses to flourish without the hindrance of diverting additional resources to recover payments. Also, it helps customers avoid falling into debt cycles.

Eligibility for eMandate

Before you pursue any eMandate ensure your eligibility by owing the following:

  • Aadhaar card

  • Bank account

Please note, it’s mandatory to have the above documents linked to one another (Aadhar-linked bank account). Additionally, the financial institution initiating this process must be registered to offer NACH services.

However, you require the below documents to complete setting up an eMandate.

  • A filled eMandate form

  • Aadhar card

  • Bank account

  • Mobile number - linked to both your bank account and Aadhar card

An eMandate can be rejected for the following reasons. Prepare for it beforehand to avoid facing rejection in the future.

  • Bank doesn’t provide NACH services

  • Incorrect account details entered

  • Wrong folio number or linked information

Thoroughly understand the eMandate process before initiating it. An unexpected rejection may delay your transactions and pose additional troubles.

FAQ

  • ✔️What is the limit of eMandates that I can set up through a single bank account?

    There are no limitations to the number of eMandates one bank account can set up.

  • ✔️What will happen if there is insufficient balance in the bank account?

    The transaction will fail and may impose additional penalty charges. 

  • ✔️How much time is needed in eMandate process?

    It takes up to 2 days to complete the eMandate process. 

  • ✔️How is an eMandate different from an ECS mandate?

    While eMandates are an online auto-debit process, an ECS mandate requires offline intervention by physically submitting the documents, etc.