National Automated Clearing House (NACH), a bulk payment system operated by the National Payments Corporation of India (NPCI), will be available 24X7 from August. Currently, it is available only on bank working days. “In order to further enhance customer convenience, and to leverage the 24×7 availability of real-time gross settlement (RTGS), NACH which is currently available on bank working days, is proposed to be made available on all days of the week effective from August 1, 2021,” RBI Governor Shaktikanta Das said while announcing the bi-monthly monetary policy review.
As per the RBI governor, this decision has been taken to enhance customer convenience.
What is NACH
The National Payments Corporation of India (NPCI) launched NACH for banks, financial institutions, corporations, and the government to facilitate interbank, high-volume, electronic transactions that are repeated and periodic. It is a popular and prominent mode of direct benefit transfer to large number of beneficiaries.
What does it mean for you
This means that come August 1, your salary credit into your bank account, home loan EMIs, investments in mutual funds and insurance premium, bill payments such as telephone bills, gas payments, electricity bills etc. will take place even on bank holidays.
Currently, any auto-debit instructions given by the account holder does not get processed on days the bank is closed like Sundays, bank holidays and gazetted holidays. NACH is used for salary credits by most of the companies, and the salary account does not get credited on Sundays or bank holidays.
“NACH has emerged as a popular and prominent mode of direct benefit transfer (DBT) to a large number of beneficiaries. This has helped the transfer government subsidies during the present COVID-19 in a timely and transparent manner,”RBI said.
The Reserve Bank of India (RBI) decided to leave the benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance in view of the Covid-19 pandemic, Das said while announcing the bi-monthly monetary policy review on Friday
This is the sixth time in a row that the Monetary Policy Committee (MPC) headed by RBI Governor Shaktikanta Das has maintained status quo. RBI had last revised its policy rate on May 22, 2020.