Cost effective.<\/p>\n<\/li>\n<\/ul>\n

Q.16. Is there any limit on the value of individual transactions in ECS Credit?<\/strong><\/p>\n

Ans : No. There is no value limit on the amount of individual transactions.<\/p>\n

Q.17. What are the processing \/ service charges levied under ECS Credit?<\/strong><\/p>\n

Ans : The Reserve Bank of India has deregulated the charges to be levied by sponsor banks from user institutions. The sponsor banks are, however, required to disclose the charges in a transparent manner. With effect from 1st July 2011, originating banks are required to pay a nominal charge of 25 paise per transaction to the Clearing house and destination bank respectively. Destination bank branches have been directed to afford ECS Credit free of charge to the beneficiary account holders.<\/p>\n

ECS (DEBIT)<\/p>\n

Q.18. Who can initiate a ECS Debit transaction?<\/strong><\/p>\n

Ans : ECS Debit transaction can be initiated by any institution (called ECS Debit User) which has to receive \/ collect amounts towards telephone \/ electricity \/ water dues, cess \/ tax collections, loan installment repayments, periodic investments in mutual funds, insurance premium etc. It is a Scheme under which an account holder with a bank branch can authorise an ECS User to recover an amount at a prescribed frequency by raising a debit to his \/ her bank account.<\/p>\n

The User institution has to first register with an ECS Centre. The User institution has to also obtain the authorization (mandate) from its customers for debiting their account along with their bank account particulars prior to participation in the ECS Debit scheme. The mandate has to be duly verified by the beneficiary\u2019s bank. A copy of the mandate should be available on record with the destination bank where the customer has a bank account.<\/p>\n

Q.19. How does the ECS Debit Scheme work?<\/strong><\/p>\n

Ans : The ECS Debit User intending to collect receivables through ECS Debit has to submit details of the customers (like name, bank \/ branch \/ account number of the customer, MICR code of the destination bank branch, etc.), date on which the customer\u2019s account is to be debited, etc., in a specified format (called the input file) through its sponsor bank to the ECS Centre.<\/p>\n

The bank managing the ECS Centre then passes on the debits to the destination banks for onward debit to the customer\u2019s account with the destination bank branch and credits the sponsor bank’s account for onward credit to the User institution. Destination bank branches will treat the electronic instructions received from the ECS Centre on par with the physical cheques and accordingly debit the customer accounts maintained with them. All the unsuccessful debits are returned to the sponsor bank through the ECS Centre (for onward return to the User Institution) within the specified time frame.<\/p>\n