Home / Industry / Banking /  NACH payments to be available on all days of the week

The bulk payment system under the National Automated Clearing House (NACH) will be available on all days of the week from 1 August, the Reserve Bank of India (RBI) said on Friday.

The service, used for recurring payments by consumers and direct subsidy transfers by the government, has so far been operational only on bank working days.

Operated by the National Payments Corp. of India, NACH facilitates one-to-many credit transfers such as payment of dividend, interest, salary and pension as well as the collection of payments pertaining to electricity, gas, telephone, instalments towards loans, investments in mutual funds and insurance premium.

“The RBI has taken successive steps over many years to ensure that digital payment options are available every day, every hour, and this is yet another step in that direction," said Adhil Shetty, chief executive at, a financial services marketplace.

“Thanks to the power of automated clearing, payment systems will work for you all year—even on weekends. During covid-19, it is also necessary for payments to be done digitally to lower contamination risks and therefore steps such as these help," he added.

The RBI said NACH has emerged as a popular and prominent digital mode of direct benefit transfer to a large number of beneficiaries.

“This has helped transfer of government subsidies during the present covid-19 in a timely and transparent manner. In the interest of customer convenience, and to take advantage of the availability of Real Time Gross Settlement (RTGS) on all days of the year, it is proposed to make available NACH on all days of the week throughout the year, effective 1 August," it said.

In May, NACH was used for 406.6 million debit and credit transactions, showed RBI data.

“The decision is a welcome move that will enhance investor experience and enable faster processing times for salaries, dividends and pension distributions. The finance and banking industry will benefit from this at large, and so will the millions of beneficiaries of NACH who will receive their respective benefits promptly with minimum delay," said Rajesh Mirjankar, MD and CEO at fintech solution provider InfrasoftTech.

In addition, NACH availability on all days will now enable industries to leverage electronic payment modes to a greater extent. It is also imperative to note that digital payments will be more impactful when all electronic payment modes are made available on all days, he added.

Experts pointed out that the new rule will significantly cut down the time for systematic investment plan (SIP) registration that act as auto-debit mandates for mutual fund investments.

According to mutual fund distributors, it currently takes two-three weeks to register SIPs through NACH. The speed depends on the investor’s bank, with some smaller banks or nationalized banks taking longer for registration.

This will speed up with the new RBI rules, say experts.

“NACH processing on all days will cut down the processing time for SIP registration and improve investor experience. There will also be less clustering of SIPs start and cycle days," said Ganesh Ram, chief executive of Mutual Fund Utilities (MFU), an online mutual fund investment platform.

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