What is NACH, ECS or NEFT in Banking System

  • ECS: Elecronic Clearing System
  • NACH: National Automated Clearing House

NACH (National Automated Clearing House) which is the upgraded version of ECS and introduced by National Payments Corporation of India, is a centralised clearing service that aims at providing interbank high volume, low-value transactions that are repetitive and periodic in nature. It has both transaction and file-based transaction processing capabilities. It has binded multiple ECS(Electronic Clearing System) or all the banks in India under one system.

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Payment Reference(BSEG-KIDNO)

The payment reference contains a key for customer line items which is passed on to the customer in the invoice. The customer should refer to the payment reference when making the payment.

For vendor line items, the key that the vendor passes on in the invoice is entered in the payment reference. In automatic payment transactions, the payment reference can be passed on again to the payee.