Advantages of ECS Credit:
i. Beneficiary Benefits:
- The beneficiary need not visit his / her bank for depositing the paper instruments which he would have otherwise received had he not opted for ECS Credit.
- The beneficiary need not be apprehensive of loss / theft of physical instruments or the likelihood of fraudulent encashment thereof.
- The beneficiary receives the funds right on the due date.
ii. Benefits to User Institutions:
- User institutions also enjoy many advantages. For instance, cost incurred on administrative machinery and printing, dispatch and reconciliation of paper instruments etc is saved which would have been incurred had beneficiaries not opted for ECS Credit.
- Avoid chances of loss / theft of instruments in transit, likelihood of fraudulent encashment of paper instruments, etc. and subsequent correspondence / litigation.
- It is an efficient payment system which ensures the beneficiaries get credit on a designated date.
iii. Benefits to Banking system:
- Freedom from paper handling and the resultant disadvantages of handling, presenting and monitoring paper instruments presented in clearing. Ease of processing and return for the destination bank branches.
- Smooth process of reconciliation for the sponsor banks.
