ECS is a mechanism in banking throuh which, a fixed amount on the written request of the customer is debited by the finance company as EMI against loan extended or it is debited for the purpose of recurring deposit on monthly/quarterly/half-yearly basis on a fixed date, This mechanism is also used to credit the amount of dividend owed by you on and company which you have invested in or my an Asset Management Company (Mutual Funds). It is a standing instruction by the customer which is better know as Electronic Clearing Service.
The method of ECS in India proves that our country is developing rapidly in termes of banking. However many draw backs lie in this service. If account number is wrong, whole money gets transfered to other account. Adhere to this, if database is destroyed, whole transaction gets stuck unless the data are derived from the server.
ECS is an electronic mode of funds transfer from one bank account to another. It can be used by institutions for making payments such as distribution of dividend interest, salary, pension, among others. It can also be used to pay bills and other charges such as telephone, electricity, water or for making equated monthly installments payments on loans as well as SIP investments. ECS can be used for both credit and debit purposes.
Electronics Clearing Service is being used by many these days to pay all their bills like electricity,telephone ,water etc,...It is convenient and also there is no delay since it is deducted soon after the bill gets generated...
ECS is Electronic Clearing Service. It is used by the company to pay bills or for making equal monthly installments. It is also useful for making payments such as distribution of dividend interests, salary, pension, etc.