How the auto-debit feature keeps you financially disciplined

How the auto-debit feature keeps you financially disciplined

Jan 9, 2024

Living in a fast-paced, fleeting age requires staying on top of multiple things that demand your time and attention at the same time. Thanks to technology, managing a lot of it is becoming increasingly convenient for people living in the digital age. There’s an app to help you do everything from paying bills to streaming content or availing banking services from the convenience of your home.

Digital banking has made life easier with features like the auto debit facility helping you set up an automatic bill payment plan to manage your credit card bill payment, utilities, or even entertainment expenses. You can also look at using the autopay facility for your loan payments, which helps you eliminate the constant worry of missing EMI payments, especially in the case of managing multiple credit accounts. 

The benefit of scheduling your payments is that it automatically debits the amount due across various EMI accounts, on a fixed date, every month without you having to go through any of the tracking or transaction processes.  All you need to do is inform the lender at the time of KYC documentation that you will be activating the auto debit option toward due payments. The RBI has recently raised the automatic direct debit limit up to ₹15,000 without the need to use OTP to initiate or complete a transaction. This demonstrates the RBI’s faith in this particular feature in digital banking.

Here’s a holistic understanding of the payment facility and its many advantages. 

Wondering how to initiate a direct debit from your bank account?

If you are confused about how to initiate this facility, just call the customer service of the financial institution you are associated with and tell them what you need. Alternatively, you also have the option to raise a request when availing a credit facility. Your bank should be able to activate the auto debit facility on your account within 24 hours.

There are two simple ways of going about it:

  1. If you are trying to activate the feature through NetBanking, you will need your NetBanking ID and password. You can then log in to your account and choose the preferred option to activate your automatic payment facility.

  2. You can also visit your bank’s official website and activate the automatic payment option. Once you avail of the facility, the amount is debited from your account on a set date every month. 

Once activated, you can also check for options to reschedule the date or stop the automatic payment facility as per your convenience.

Summing up the benefits

Not only is this feature simple and easy to authenticate, but there are also other benefits of autopay options, which are:

Time-saving and convenient

One of the main reasons to switch to the automatic payment feature is the convenience that is imbued into your money management regime. Once the facility is set up, all your bills and due payments get paid with no intervention from you or the need for you to monitor the payment schedule. However, you need to ensure to maintain an adequate balance in the account taking into account the amount that needs to be debited from your account systematically.

Boosts credit score

Not only does the automatic payment feature save time, it also helps improve your credit score. Thanks to the auto-debit facility, your dues will always be repaid on time and you will also start to get reminders a few days before payment is due. As long as you have the requisite balance on your account, this can help you create a healthy repayment track record, which boosts your credit score significantly. Considering that even one missed payment can cause a dip in your credit score, this facility will eliminate all and any chances of the same happening. 

Earn rewards for staying on track 

With a lot of players, making active use of the automatic debit option goes a long way in earning rewards too. This is part of the reason why you shouldn’t be putting off activating this feature on your credit accounts. Paying your monthly bills on time without fail, month on month allows you to enjoy rewards like cashback, coupons, or other discount options. This means every time your account gets debited, you can collect reward points that can be redeemed as you want.

Leaving you with some parting suggestions

You can easily set up this automatic payment plan when you avail of an instant personal loan from SmartCoin. Thanks to our hassle-free KYC documentation process, activating the auto-debit feature following taking out a personal loan from SmartCoin is unbelievably easy!