NACH Mandate
Definition
An authorisation under India's National Automated Clearing House system allowing a company to collect recurring payments — loan EMIs, insurance premiums, SIPs — directly from a customer's bank account.
Related Terms in Banking & Payments
Virtual Account
A unique account number issued on top of a single real bank account so that incoming payments can be automatically identified and reconciled to the right customer or invoice.
Escrow Account
An account where a neutral third party holds funds until agreed conditions are met, protecting both buyer and seller in a transaction. The money is released only when the terms are satisfied.
Bank Overdraft
A facility allowing a business to withdraw more than its account balance up to an agreed limit, providing short-term working capital. Interest is charged on the amount used.
Cash Credit
A short-term borrowing facility in India where a business can draw funds up to a sanctioned limit, typically secured against inventory and receivables, with interest on the amount actually used.
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