>> August 19, 2009
Definition of EMI
EMI is the finance term . EMI means easy monthly installments or Equal Monthly Installments because this installment is paid on loan or payment of purchased
product monthly basis according to contract bank or company . When you take personal or house or any other loan from bank . Bank fixes your monthly installment for repayment of his loan after seeing your salary or professional or business income . Interest is included in it as per regulations of RBI and respective bank's terms . So , in finance sector it is known as EMI .
Definition of ECS
ECS is also finance term and it means Electronic clearing service . Reserve bank of India has defined clearly ECS in his FAQ related to ECS . Link
If you want to know ECS , then I try to explain RBI's definition relating to ECS .
Electronic Clearing Service (ECS ) is the system of electronic funds transfer from one bank account to another bank account .
Suppose , if you are employee in an company and your salary is deposited in bank account . If you have taken bank loan for personal purpose , then you can contact your bank and allow bank to deduct EMI from your salary , then this system of transfer of fund from your account to that bank who gave you loan is called ECS . By taking this facility , you can also pay interest and other bills like telephone or Internet also . Company can also get this facility from bank for automatically payment of dividend , interest , salary and pension on due dates . After revolution of Internet ,Finacle and other bank software can easy tranfer of fund from one account to another . So , providing of ECS facility is most benefited for customers and bank also .
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