This is how you can simplify recurring payments
What's the story
In our busy lives, keeping track of regular payments for utilities, subscriptions, and even investments can be a hassle.
E-mandates in India have changed the game, making it easy to automate all those recurring payments.
No more worrying about missing a payment or wasting time logging into multiple accounts.
Getting a grasp on e-mandates can be a big step toward streamlining your financial management tasks.
Basics
What is an e-mandate?
An e-mandate is an electronic permission granted by you to banks or service providers, authorizing them to automatically debit a predetermined amount from your account periodically.
This can be for different services such as mutual fund SIPs, loan EMIs, or utility bills.
The process entails connecting your bank account with the service provider via a one-time authorization online, eliminating the need for manual interventions for each payment.
Setup
Setting up an e-mandate
How to create an e-mandate:
Log in to the service provider's or bank's portal where you want to automate payments.
Choose the e-mandate option, enter your bank details, and authenticate the mandate through net banking or debit card.
Once your bank verifies it, the mandate gets activated.
Typically, the cap is set at ₹1 lakh per transaction.
Advantages
Benefits of using e-mandates
E-mandates are super convenient, save you from late payment charges, and help you manage your cash flow better.
No need to remember due dates or deal with the headache of making manual payments every time.
For those investing in mutual funds via SIPs or people with recurring loan EMIs, e-mandates guarantee that your investments and repayments are never late.
Caution
Considerations before opting for e-mandates
While e-mandates are super useful, you should always ensure you have enough balance in your account; else you may have to pay penalty for non-sufficient funds (NSF).
Review your mandates regularly to make sure you still need them, and adjust amounts as necessary—say, after a hike in subscription fees or if you want to increase SIP amounts in mutual funds.
Management
Managing and cancelling e-mandates
Managing e-mandates is simple—majority of the banks and service providers provide you an online dashboard where you can check all your active mandates.
If you wish to cancel or modify a mandate, such as changing the debit amount, you can usually do so through the same portal where you created it.
Keep in mind that modifications may take a few days to process.