Razorpay POS has unveiled instant UPI transaction refunds that reduce refund processing time from conventional 5-6 business days to about 2 minutes.
One of the leading Indian fintechs and the creator of one of the top neobanks in India, Razorpay has launched a new fully automated Instant Refunds for UPI solution to help merchants deal with the inconveniences of delayed or unresolved UPI transactions on their in-store POS (Point of Sale) devices.
The process involves an initial refund attempt within 3 seconds, with the following three persistent retries. As the time interval between each attempt in case of initial failure is only 5 seconds, the whole refund process might take about 1-2 minutes instead of a whole business week. This significantly increases the efficiency of payment processing and consumer satisfaction levels.
According to Razorpay, around 5-15% of UPI transactions encounter friction due to their long-term pending status. For businesses, that may bring substantial losses since many customers hesitate to reattempt the transaction until they receive their refund, abandoning the purchase altogether in 30-40% of the cases.
UPI digital payments ecosystem is omnipresent in the Indian financial landscape. The total number of UPI transactions exceeded 118 Billion in 2023, illustrating a significant 60% growth from year-on-year.
At present, UPI users constitute about one-fifth of the Indian population. However, its wider adoption faces certain technical obstacles. Delayed refunds are one of them. Thus, 53% of MSME retailers named internet issues and failed transactions among the primary impediments to UPI adoption.
“This new offering reiterates our goal of simplifying money movement and demonstrates our innovation-first mindset as we continue to work towards shaping the future of payments.”
Byas Nambisan, CEO, Razorpay POS
Earlier, Razorpay expanded its product portfolio with an acquisition of the digital billing platform BillMe. With the new acquisition, Razorpay can offer online and offline payment solutions for businesses enhanced with digital bills available to customers across different channels. The expected benefits of digital invoicing include reduced friction at the checkout counter, reduction of environmental harm, cost-saving on receipt printing, simplified invoice processing, and more.