InvestorQ : What are the acceptable repayment modes for EMI based loan?
shrinidhi Rajan made post

What are the acceptable repayment modes for EMI based loan?

Radhika Arya answered.
11 months ago
When you pay back the borrowed money to the lender, that process is known as repayment. It is generally done in periodic payments and those payments cover principal and interest. Any default in the repayment of the loan could leave a negative impact on your credit score. 

The borrowers can repay their loans in any form and do not make any difference whatever mode you choose. There are various options available and the borrower can choose any of these according to his feasibility:

NACH (National Automated Clearing House): It is the program offered by the National Payments Corporation of India (NPCI) to banks, financial institutions, and government services. This process allows transactions to be processed in real-time mode, be it high volume transactions or lower value transactions.

Post-Dated cheque: These cheques are issued by the payers for a future date. These could generally be cashed or deposited in the bank on a future date as mentioned on the cheque. It basically works as a bill of exchange and is very common. It cannot be payable or demanded before the date mentioned.

ECS (Electronic Clearing System): Under this model, funds are transferred electronically from one bank to another. Most of the financial institutions use this mode to transfer payments such as salaries, dividends, pensions, etc. There’s no restriction on any amount of payment through this mode.

Standing Instruction/ Debit Mandate: An account holder can give a standing instruction to its bank to pay a fixed amount to another bank/account at a pre-decided interval. It is suitable for options under which a fixed amount needs to be paid.