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From August 1, there will be no holidays for payment of salary, pension, EMI, dividends, or any payment done electronically. All these payments that could not be done on bank holidays can now be done on any day, thanks to a recent announcement by the Reserve Bank of India. Any large standing instructions can be processed every day, irrespective of any factor.
From Sunday, August 1, you will not have to wait for the weekend to get over for your salary, pension, interest, dividend and other payments and investments to get credited to your bank account.
Effect on the common man
National Automated Clearing House (NACH) will function every day from August 1.
Generally, salary, pension, or dividend payments are made through NACH, as the money reaches the accounts of a large number of people at the same time.
Till now this facility is available only on the working days of the bank, so we never got salary or pension or any other mass payment (except NEFT and RTGS) on Sunday or holiday.
Standing instruction payments such as recurring deposits, SIP of MFs payment, the insurance premium would be processed on Sunday or bank holidays.
Decode NACH
NACH, a bulk payment system operated by the National Payments Corporation of India (NPCI) facilitates one-to-many credit transfers such as payment of dividend, interest, salary and pension.
It also facilitates the collection of payments pertaining to electricity, gas, telephone, water, periodic installments towards loans, investments in mutual funds, and insurance premiums.
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 of government subsidies during the present coronavirus situation in a timely and transparent manner, confirmed government officials.
RBI’s move
“In order to further enhance customer convenience, and to leverage the 24×7 availability of 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 Shaktikant Das said during the monetary policy announcement on June 4.
Keep in mind
For borrowers, there is a fixed day to pay the monthly installment. The same goes for SIP, payment of bills, or premium.
For all these payments, we usually go for an auto-debit facility that obviates the need for remembering the date. With the new norms will be in a place we have to maintain sufficient balance on those days, whether that is a Sunday or any holiday.
So, from next month onwards it is necessary to keep a sufficient amount in the account on those dates on which EMI or any other payment is due.