Setting up e-mandate for new SIPs has now become easier for your clients.
RBI has allowed National Payment Corporation of India (NPCI) to enable bank account holders to generate electronic mandate through their debit cards and net banking account.
The move would open doors for easier SIP registration for advisors. Now, your clients just have to do a test transaction through the bank portal to activate the e-mandate.
Srikanth Meenakshi, co-founder FundsIndia shared that his firm tied up with four banks to activate e-mandates for clients. “The biggest advantage of an e-mandate is the zero paperwork involved. The paperless process is quicker and the SIP can start within a month. Moreover, it eliminates rejections due to signature mismatch, which was another challenge while registering the client for auto-debit.”
Mukesh Kalra, CEO, ET Money feels that the move would help online distributors. "We saw a significant drop in SIP registration after the Aadhaar issue. The move will ease the SIP registration process and online distributors would see more new SIPs registrations in the coming months.”
Kalra further said that his company would soon launch this facility to make MF investing easy for clients.
Earlier, e-mandate was discontinued after the Supreme Court instructed fintech companies not to use Aadhaar to authenticate electronic transaction which included generating e-mandates.
Currently, seven banks have registered for net banking based e-mandates. Yes Bank, Kotak Mahindra Bank, Axis Bank, IndusInd Bank, Central Bank of India, Bank of Baroda and Punjab National Bank are some of the banks, which have gone live with the net banking based e-mandate.
