Electronic Clearing Service (ECS)

It allows fund transfer electronically between accounts held at different banks, facilitated through a clearing house. This facility is generally used for bulk credit and debit transactions like distribution of dividends, interests, salary pension, payment of utility bills like telephone, insurance, taxes etc based on the mandates obtained from the beneficiary/payee.

The facility is offered by Reserve Bank of India and can be availed at selected locations.

Type of ECS Transactions:

a) ECS Credit: Used to credit the account of a beneficiary customer.
b) ECS Debit: Which facilitates payment of bills, taxes etc by debiting the amount from the account of a customer.

ECS credit/debit facility can be availed at all available locations.

Steps for both ECS Credit and ECS Debit:

The user willing to participate must obtain a mandate from the beneficiary / payee, which includes account particulars and other particulars as prescribed by RBI.

User Registration:

The user should register by submitting an E1 form to the NCC or Clearing House and should obtain a 7 digit user code from RBI, for participating in ECS.

The user will have to route the ECS through a Sponsor Bank. The Company is required to submit the data in a specified format to one of the approved clearing houses through the sponsor bank.

The user then submits the data in soft form for ECS.

The data has to be provided to the Sponsor Bank well in advance before the settlement date. The settlement date is the date on which the account of the beneficiary will be credited (ECS Credit) or payee's account will be debited (ECS Debit).

Clearing house/NCC will validate the file before processing it. The process checks for records which are submitted in incorrect format, with incorrect user details or incorrect Credit or Debit contra.

Customers are requested to furnish new CBS account numbers for ECS process and fill in fresh mandates and furnish them to user institutions ( if the existing mandate contains the old account number ) 

ECS Debit Mandate:

ECS debit is based on the mandate given by the destination account holders. The account holders who wish to pay the Bills, taxes etc should submit an ECS Debit Mandate. The Mandate submitted by account holders will be forwarded to the utility companies (Telephone companies, Insurance companies etc), after verifying the signature of the account holder.

Note: 1) As per RBI instructions, if the debit record is repeatedly presented despite withdrawal/non-existence of mandate, for more than three ECS runs, the clearing house may consider not entertaining the future ECS runs of that particular user institution.

2) It is the user’s responsibility to ensure the correctness of the contents submitted in the softcopy.

Please refer the RBI guidelines for more details

Other Links:

Find the List of ECS Branches 
FAQ’s