Covid-19 impact! Auto debit bounce rate sees a month-on-month rise; 37% failed transaction at 3.20 crore in June 2021 - What NPCI, NACH data reveal

Covid-19 pandemic has had a profound impact on the economy and that can be assessed by the auto-debit bounce rate in June 2021. There has been a month-on-month increase in the bounce rate between April and June. Zee Business’ Anurag Shah has this detailed report. 

As per the data from the National Payments Corporation of India (NPCI), the combined auto debit failure of all the banks in the country stood at 37 per cent in June. The NPCI data further suggested that out of the 8.70 cr auto debit transactions processed through National Automated Clearing House (NACH), 3.20 crore auto debit transactions failed because of inadequate balance in the accounts.     

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In May the auto debit failure numbers were at 36 per cent while in April it was at 34 per cent.  

In terms of the transaction value, the quantum of auto debit amount is 30 per cent of the total transaction value over the last two months.  

Shah in his report tells that the CIBIL score of an individual suffers in the event of repeated auto debit failures. He also says that the auto debit failure also points out to the stress in the economy.   

Month-wise Auto Debit failure rate  

- April – 34 per cent
- May – 36 per cent
- June - 37 per cent

Transaction Value of Auto Debit Failure

- April - 27.99 per cent
- May - 30.74 per cent 

June- 30.27 per cent

- NPCI data suggests that 37 per cent of the auto debit transactions failed in June
- In June, out of 8.70 crore auto debit transactions, 3.20 crore transaction bounced 
- The auto debit bounce was on account of inadequate balance 
- The auto debit bounce rate has increased on the month-on-month basis despite unlockdowns.  
- Transaction failure is indicative of the stress levels in the income of people 
- In the event of ECS bounce, if one makes an immediate payment, there is no impact on CIBIL score. 
- Repeated failures lead to adverse impact on CIBIL score. 
- People are missing on payments of EMIs amid the Covid-19 pandemic.