e-Mandate & ECS Mandate: Recurring Payments (New Guide)

Close on the heels of UPI, e-Mandate is the latest step jump. 

e-Mandate and ECS mandate are payment services, initiated by RBI and the National Payments Corporation of India (NPCI). They provide the underlying infrastructure for businesses to collect recurring payments.

Recurring payments are intrinsic to many businesses – new and old. However, India has lacked a convenient way to process them due to restrictions on two-factor authentication (2FA). 

What are Recurring Payments?

Recurring payments or Subscriptions are automatic payments, where a customer authorizes a service provider to debit fixed or variable amounts at regular intervals. 

Recurring payments can find use in various business models:

  • Content: Online streaming services have revolutionised the way we watch videos and listen to music. Companies like Netflix, Amazon Prime, Spotify etc. are heavily dependent on subscriptions that need to be renewed at fixed intervals. It also includes newsletters and magazines that require a monthly or annually recurring fee
  • SaaS: SaaS businesses are heavily dependent on charging a recurring payment every month which can scale up with use.

  • Financial Services: Loan repayments, investments and insurance premiums are best paid over in recurring intervals.
  • Utility: Telephone bills, Electricity bills, cable bills, gym membership etc. come under utilities, which like we already know, are recurring in nature
  • Retail & eCommerce: Delivery of groceries and ready-made meals 

ECS mandate – Paper Mandates

Prior to the emergence of e-Mandate, the Reserve Bank of India (RBI) introduced ECS mandate or Electronic Clearing Service.

What is ECS mandate?

This process involves submitting a physical form i.e., a mandate to your bank or a company. 

But, this solution isn’t a very efficient one. 

Systematic Investment Planning (SIP) is one of the most common and preferred ways of investing in mutual funds. And, the repetitive payment were done using ECS.

But, each step involved a prolonged process

ECS mandate application

  1. You fill your SIP instruction and the ECS mandate. (bank account details, scheme name, SIP amount, debit intervals etc.) 
  2. Once you submit these forms to your fund house they will be couriered to your bank.
  3. The bank then verifies your signature, and if accepted, register the ecs debit instructions in their systems. 

This entire process of SIP registration through ECS mandate took anywhere between 25-30 days. And, had more drawbacks:

  • If you want to register a second SIP, You have to go through the entire process again
  • In certain cases, banks would verify your mandate but wouldn’t confirm or deny it to the fund house. This would result in the fund house assuming the mandate is registered. Hence, when the fund house made your first instalment, there was a possibility of it being rejected if the bank had rejected your mandate earlier
  • If your account has insufficient funds for a particular instalment, banks can levy a charge

Due to this inefficient and prolonged process, ECS was adopted but not as extensive as it could be. 

Introducing e-Mandate – Paperless and Quick

NPCI introduced e-Mandate services to reduce processing time, make recurring payments more streamlined and efficient.

What is e-Mandate?

With e-Mandate / NACH mandate, one can easily authorize recurring payments by using their Netbanking or Debit card credentials.


If we take a look at Systematic Investment Planning, the whole process from initiating the mandate to it being confirmed is entirely digital. It does not take more than a couple of days to be confirmed.

e-Mandate process for SIP 

  1. The customer logs into the fund house’s website and fills in the mandate form details. (destination bank, account number, debit intervals, etc.)
  2. The fund house needs to ensure the destination bank (customer’s bank) listed is registered by the NPCI for mandate creation.
  3. The customer is redirected to the NPCI’s page and then to the destination bank’s authentication website.
  4. The customer authenticates the mandate by using Netbanking credentials. 
  5. The bank verifies the account number entered on the fund house’s website with the Netbanking credentials. 
  6. The bank displays the mandate filled by the customer and provides an option between accepting and rejecting.
  7. If accepted, the customer is redirected to the NPCI’s website and then back to the fund house’s website. Here the status of mandate approval will be shown. 
  8. The mandate is confirmed at the end of the day. 

That’s the whole flow, without the need for any physical process. 

Advantages over ECS mandate

  • It activates in a day, unlike 25-30 days for ECS
  • No need to submit a fresh mandate for the second SIP in a particular fund house. Every fund house requires only one mandate, it’s called a one-time mandate (OTM). Once NPCI registers the OTM for a particular fund house, all you need to do is submit a form for a fresh investment through that fund house. Process of authenticating using Netbanking is not required
  • Authentication requires just the netbanking credentials
  • If there are insufficient funds in the customer’s account the transaction will not be made. Therefore, no charges are levied
  • Low regulatory concerns

Benefits of e-Mandate for Merchants and Customers


  1. Customer retention
    • With just one-time digital authentication, e-Mandate allows you to auto-debit your customer’s account at the start of every billing cycle.
    • This process reduces the burden on the customer to authenticate a recurring payment at regular intervals and allows them to enjoy your products and services.
  2. Reduction in administrative costs
    • drastic reduction in the cost related to invoicing and having to keep up and chase late payments from customers.
    • Accounting also becomes easier when the whole process is paperless and digital.
  3. Security


  1. Undisturbed services
    • No constant payment reminders. Authenticate your subscription once and enjoy uninterrupted service at any time. 
  2. Flexible options
    • Subscriptions allow a customer to purchase a plan suitable for their needs.
    • With a variety of options, inclusions and easy termination, it provides an optimal user experience. 
  3. Simplicity
    • Authentication is a simple process. All you need is your Netbanking credentials, and you’re good to go. 

Cashfree Subscription Management

Companies of all sizes face this question, “Do we buy or build billing solution?”

Cashfree Subscription Management powers you to enable recurring payment schedule, control the billing cycle and get instant alerts on subscription activity. 

All you have to do is link Subscription plans that suit your business model and customers, let Cashfree take care of the rest.

Do more Via Cashfree APIs or Dashboard

  1. The registration process which used to happen physically is moving over to an API based e-Mandate, and this will work across multiple banks.
  2. Debiting of accounts registered prior to the release of e-Mandate still happen over file transfers. And, the process hasn’t changed.

Cashfree brings to you an easy set of APIs which take care of both the above points. 

We will help business accept subscriptions/mandates from their customers, and help them get their money on time. 

Businesses don’t have to worry about the above points separately. We provide an integrated subscription service right from customer authorization to final payment. And, all of this happens over easy to use APIs. 

In fact, businesses can also use our solution without writing any code, by using just the dashboard. 

How does Cashfree Subscription Management work?

Subscription Management works in 3 simple steps.

  1. Create a plan
  2. Add subscribers
  3. Authorize

Subscription Management Payment Modes

Below is a list of all payment modes supported by Cashfree for recurring payments.


Cashfree Subscription Management Features

Subscription Management is packed with powerful features which your business can leverage.

Looking for a recurring payment platform for your business?
Automate your recurring payment with Cashfree Subscription Management.
Contact Us
Looking for a recurring payment platform for your business?
Automate your recurring payment with Cashfree Subscription Management.
Contact Us

What is Nodal Account? Everything you need to know

Table of Contents Few real-world examples on intermediariesRBI nodal account guidelines for a marketplacePermitted credits/debits in nodal bank accountsHow to audit a nodal account?How...
Zaid Assadi
4 min read

Leave a Reply

Your email address will not be published. Required fields are marked *