What is the full form of ECS?
-
What is the full form of ECS?
-
The full form of ECS is Electronic Clearing Service. ECS is an electronic mode of fund transfer from one bank account to another bank account. It can be used for both credit and debit purposes. ECS is used by banks, companies, Corporations, Government Departments for making bulk payment in one time such as dividends, salary, pension, etc.
The ECS transaction is used by a single user source (Bank, Companies, Government departments) to multiple account holders(Customer).
ECS can also be used to pay bills and other payments such as telephone bills, electricity bills, water bills or loan installments.
This service is introduced by the Reserve bank of India(RBI). RBI Managed 15 centers for clearing, SBI manages 21 centers for ECS service on behalf of RBI, and 29 centers manage by other banks.
Types of ECS
There are two type of ECS:
Credit ECS
organization make credit to customer bank account. for example- Salary, dividend etc.
Debit ECS
Debit ECS service is used for making payments for example- EMI, bill payments etc.
How to avail ECS Scheme
You have to inform your bank and provide mandate details like bank account details, bank branch information to authorize the institution.
A person who have salary account, can contact bank authorities and sign for an Electronic clearing service scheme.
Benefits of ECS
ECS scheme provides the facility for electricity bill payment, EMI payment, mutual fund, Insurance premium etc.
It reduces the paperwork, there is no need for issuing cheques by the person making the payment because it will automatically deducted from the client account.
Timely bill payment.
It reduces the chances of fraud.
By using the ECS scheme it is easy to track the payment details.
