As per the ECS Credit Procedural Guidelines, a Mandate Form is required for ECS credits.
A Mandate for a ECS Debit transaction is understandable, but in today’s scenario, is a Mandate required for ECS Credits?
What are the transactions routed through the ECS Credit mechanism?
01) Dividend payouts
02) Salary payouts
03) Government department payouts.
What does an ECS Credit Mandate contain?
The Model Mandate Form is quoted here from the Reserve Bank of India, ECS Cr procedural guidelines.
FORM NO.E-5
Appendix – VIII
Electronic Clearing Service (Credit Clearing)
Model Mandate Form
(Investor/customer’s option to receive payments through Credit Clearing Mechanism)
Name of the Scheme and the periodicity of payment
No.
1) Investor/customer’s name:
2) Particulars of Bank account
A Name of the Bank :
B Name of the branch :
Address :
Telephone No. :
C 9-Digit code number of the bank and branch
appearing on the MICR cheque issued by the bank:
D Type of the account (S.B., Current or Cash Credit )
with code (10/11/13)
E Ledger and Ledger folio number:
F Account number (as appearing on the cheque book)
(In lieu of the bank certificate to be obtained as under, please attach a blank cancelled cheque or photocopy of a cheque or front page of your savings bank passbook issued by your bank for verification of the above particulars)
3 Date of effect:
I hereby declare that the particulars given above are correct and complete. If the transaction is delayed or not effected at all for reasons of incomplete or incorrect information, I would not hold the user institution responsible. I have read the option invitation letter and agree to discharge the responsibility expected of me as a participant under the scheme.
(.....................................)
Signature of the Investor/Customer
Date
Certified that the particulars furnished above are correct as per our records.
Bank’s Stamp
Date: (.................................)
Signature of the authorised
official of the Bank
In my view, the need for ECS Credit Mandates was required in the era of Physical Holding of Shares.
Once the shares moved into dematerialized mode, a Bank Account is compulsory.
And the bank account details are fed into the Demat Account screen. This screen captures all the data required for a successful ECS Credit transaction.
Hence, in the present scenario there is no need for a ECS Credit Mandate form.
