Going worry-proof with NACH

Having security concerns about NACH? That just makes you a smart online-loan-taker. The kind we appreciate and welcome, always.

Burp. Groan. Snooze.

Sounds of a well-enjoyed feast with your best-beer pals. Tonight, sitting idly in Armaan’s newly-purchased car, the four Maska-teers were camped outside their favourite Irani-chai cafe – the only one that would entertain them at 4 AM.

“What were you two whispering about when you came to pick us?” Their two child-hood friends asked Ankit, the butter dripping down an already-half-finished bun. It did not occur to any of them that they were complaining about popping-shirt-buttons, bulging-tummies and Bro-I-should-not have-had-so-much-salsa on the ride back from the Mexican joint. That was just a few minutes before.

“Oh, that! Armaan was just telling me about NACH. For my loan application. You never know if I fancy opening a pop-up Deli truck myself some day.” Ankit sputtered between big chunks of jam rolls.

One of the two friends snatched this chance of showing off his tech-savvy-nose here. “Careful Panther. These online things – you can’t be too cautious about them. Don’t we hear of all the frauds and scams going about?”

Ankit lost his appetite mid-journey across that marmalade-laden bun. He looked towards Armaan askingly.

Armaan laughed at his Pooh-face. He so loved this expression of his – helpless and cute. No wonder Ankit’s wife had fallen for him during a horror-movie date.  

“Don’t tell me you are going to go jittery with security concerns about NACH now? You Pokeman-playing fanatic who just escaped a manhole while catching Pikachu. Buddy. It is as safe as giving a cheque or an ECS mandate.  If not more, not less either.”

“How?” the smart-aleck interjected before Ankit could.

Armaan sighed and put down his chai-saucer. “First things first. It is recommended by the NPCI i.e. the National Payments Corporation of India and regulated by the Reserve Bank of India under the Payment and Settlement Systems Act 2007.  Use of SSL (Secure Socket Layer) for data transmission takes care of data-safety too. Then, we have separate nodal accounts pursuant with RBI guidelines and immediate disbursal of funds. All that ensures that finances are never mixed up. In short –  It is reliable, done through secure banking-channels and is far cheaper than other payment-models.

“But how can we be cent-percent sure?” Ankit murmured – more to himself than to Armaan.

But Armaan heard that and settled his doubts further. “See, you can never be perfectly sure with anything in today’s age. But you can always be extra-sure. Like here, the instruction is authorised via a card-security-system to start with.  Both the payer and payee are kept informed of every debit and the mandates can be managed (fixed or variable, frequency as desired) via a dashboard. This can entail Aadhaar eSign and a validation engine for the bank to complete the verification. Failure to honour payments is, also, a severe fault that evokes legal provisions.”

The fourth friend, who worked as a Mutual-Fund advisor, jumped in at the right point. “NACH is so common with us now – tried and tested by several institutions. Unlike cards, NACH mandates do not expire or get lost or stolen.  Like a cheque, it is a negotiable financial instrument, and thus, provisions of the Negotiable Instruments Act 1881 as well as Payment and Settlement Systems Act 2007 apply. Of course, you cannot afford to leave blank spaces or sign this form without filling it? But then, those are precautions you would take with a cheque too, right?”


Armaan smiled and nodded confidently. “Ankit my Man. NACH is just a new, better and faster system. It’s here for making life and loans faster and better for us only. You can chill on security concerns about NACH. If there is anything you should be worried about now, it is that doughnut that our fourth musketeer is stealing away from your plate.

But before the sweet-smelling beauty could disappear in their friend’s mouth the three beasts pounced on him and took away his treats too.

Watching these elephants nibble away his feast, he helplessly gestured the cafe Uncle for another chai.

Grunt.