e-NACH and e-Mandate

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e-NACH and e-Mandate – National Payments Corporation of India (NPCI) has implemented “National Automated Clearing House (NACH)” for Banks, Financial Institutions, Corporate and Government a web based solution to facilitate interbank, high volume, electronic transactions which are repetitive and periodic in nature. NACH System can be used for making bulk transactions towards distribution of subsidies, dividends, interest, salary, pension etc. and also for bulk transactions towards collection of payments pertaining to telephone, electricity, water, loans, investments in mutual funds, insurance premium etc.

The NACH e-Mandate system facilitates issuance and confirmation of mandate by customers through alternate modes to paper based mandate.

eNACH is the electronic process of helping the banks, financial institutions and other government bodies to provide automated payment services. Once the user signs the eNACH or electronic NACH form, he gives permission to the concerned authority to debit the said amount from his bank every fixed day of the month.

Eligibility Criteria

Anyone with an Aadhaar linked bank account at a participating bank is eligible to apply for e-Mandates.

Limits for the number of e-Mandates that can be set up through a single bank account

No, there is no limit to the number of e-Mandates that can be set up for an account.

Can I set up e-Mandates or e-NACH as an option for collecting recurring payments from my customers?

e-Mandates are now available for merchants to use. Razorpay Subscriptions is a great way to automate recurring payments using e-Mandates and other payment modes like credit cards.

How does the service work?

E-Mandates can be directly set up through a netbanking transaction from merchant websites. In order to do this, a customer would need to complete a onetime netbanking transaction authorization after which all subsequent payments will not require customer intervention.

Netbanking is the primary mode for e-Mandates at the moment, with more payment modes to be added in the future.

The objectives of e-Mandate are:

  • Creating an authenticated mandate through electronic modes.
  • Shorter mandate acceptance cycle or auto acceptance of mandates.
  • Secured and assured mandate acceptance.

Proposed e-NACH Process

e-NACH process has been set up to solve the above problems. With the advent of eNACH, the need to fill NACH form has been eliminated. When using electronic NACH, the process can be completed within a few hours, since the entire system requires minimum human interaction and logistical dependency is very low. eNACH utilizes the services of NPCI’s National Automated Clearing House (NACH), to attain its objectives.

Now, it has the following entities involved:

  1. NPCI – National Payments Corporation of India is the regulatory body constituted by the Government of India to oversee all Retails payments in India. It was set up with the guidance and support of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA).
  2. Sponsor Bank – These are the banks’ empanelled with the NPCI for the purpose of facilitating eMandate process. There are currently 3 sponsor banks HDFC, HSBC and Punjab National Bank.
  3. Destination Bank – Your bank where you hold the account from which you want the automatic debit to be made.
  4. Corporate – The Company/Bank for which you have requested the eMandate so that they can auto-debit your bank account.
  5. Customer – You are termed as the customer, since you are going to apply for the e-NACH through the Corporate.

e-Mandate Advantage over ECS mandate

  • It activates in a day, unlike 25-30 days for ECS
  • No need to submit a fresh mandate for the second SIP in a particular fund house. Only one-time mandate (OTM) is required.
  • Authentication requires just the net banking credentials
  • If there are insufficient funds in the customer’s account the transaction will not be made. Therefore, no charges are levied
  • Low regulatory concerns

Benefits of e-Mandate / e-NACH for Merchants and Customers


Customer retention

With just one-time digital authentication, e-Mandate allows you to auto-debit your customer’s account at the start of every billing cycle. This process reduces the burden on the customer to authenticate a recurring payment at regular intervals and allows them to enjoy your products and services.

Reduction in administrative costs

Drastic reduction in the cost related to invoicing and having to keep up and chase late payments from customers. Accounting is easier when the whole process is paperless and digital.


Your customer’s data is safe, as the PCI compliance will be strictly managed by your payment solutions provider.


Undisturbed services

Authenticate your subscription once and enjoy uninterrupted service at any time; No constant payment reminders.

Flexible options

Subscriptions allow a customer to purchase a plan suitable for their needs. With a variety of options, inclusions and easy termination, it provides an optimal user experience. 


Authentication is a simple process. All you need is your Netbanking credentials, and you’re good to go. 

Cashfree Subscriptions

Companies of all sizes face this question, “Do we buy or build billing solution?”

Cashfree Subscriptions powers you to enable recurring payment schedule, control the billing cycle and get instant alerts on subscription activity. All you have to do is link Subscription plans that suit your business model and customers, let Cashfree take care of the rest.

The e-NACH/e-Mandate system assists in the issuance and confirmation of mandate by the customers through alternate channels to paper-based mandate.

The process is routed in a way that the destination bank, after authentication, moves the mandate to the sponsor bank or from the corporate to the sponsor bank and then to the destination bank, which includes the attributes of the customer.

  • Creation of an authenticated mandate by the customer himself through electronic channels.
  • Shorter mandate acceptance cycle or auto acceptance of mandates.
  • Secured and assured mandate acceptance- mandates are initiated by the customer or his banker.

The primary objective of eNACH/eMandate is to reduce the burden of processing on the destination bank; therefore all the aspiring participants on eMandate platform should implement end to end process automation including auto submission of authenticated mandates to NACH system.

NPCI reserves the right to allow participation in the eMandate process depending on the readiness of the bank to process with full automation. eNACH is one of the newest methods of electronic payment and thus is still in the early stages of adoption. There are around 10 banks that have already adopted eMandate and more are getting in line.