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Is it necessary for user institutions to collect the mandates from beneficiaries?

April 26, 2017beneficiaries collect Institutions mandates necessary user

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Is it necessary for user institutions to collect the mandates from beneficiaries?

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Ans : Yes. A model mandate form has been prescribed for the purpose (available in the ECS Credit Procedural Guidelines at the location http://www.rbi.org.in/scripts/ECSUser.aspx). The securities market regulator (SEBI) has also issued guidelines to investors to furnish their bank account details in the share applications for printing the same on the physical interest / dividend warrants. Therefore, user institutions should not have difficulty in collecting the bank account particulars and mandates from beneficiaries. Payment processing by destination banks becomes smooth and easy once a database is prepared, maintained and updated by the user institutions.