Failed bank transfer via UPI, IMPS? When you will you get your money back, what to do if don't get refund on time


April 1 (i.e., Thursday) was the financial year closing and banks were shut on that day. Due to this, many customers of various banks faced issues related to the transfer of money via NEFT, IMPS and UPI. As per a tweet by the National Payments Corporation of India (NPCI): The Financial year-end closing had led to some UPI and IMPS transaction failures at few banks. We have observed that most of these bank systems are back to normal since last evening. Customers may avail uninterrupted IMPS and UPI services.

However, as per replies by customers to the NPCI tweet, many whose transactions failed are still waiting for the amount to be credited back into bank accounts, two days later.

So, now the question that many will be asking is how long does it take for the amount to be reversed back to the bank account in case of a failed NEFT, RTGS or UPI transaction?

The Reserve Bank of India (RBI) issued a circular dated September 19, 2019, on the harmonisation of the Turn Around Time (TAT) and customer compensation in case of failed transactions. As per the circular, if the money debited from customer’s bank account does not reverse back to the bank account within the specified time period, due to a failed transaction, then the bank is liable to pay a penalty of Rs 100 per day to the customer.

As per the circular, in case of failure of an IMPS transaction where customer account is debited but the beneficiary account is not credited, auto-reversal must be done in T+1 day, where T refers to the transaction date. What it means is that if a transaction fails today, the amount should be credited back to the account of the person initiating the transaction by the end of next working day. If the bank does not credit the amount back to the customer’s account by T+1 day, then the bank is liable to pay a penalty of Rs 100 per day for the delay beyond T+1 day.

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Similarly, in case of transfer via UPI, where bank account is debited but beneficiary account is not credited, then auto-reversal must be done by the beneficiary bank by T+1. If not done, then penalty of Rs 100 per day beyond T+1 is levied.

In case you have experienced such a failed transaction you need to check the timeline allowed to your service provider to settle this issue. If they fail to do so within this timeline you need to lodge a complaint with your service provider or system participant. If they fail to resolve this issue within one month you can escalate the issue to the Ombudsman under The Ombudsman Scheme for Digital Transactions, 2019. You may reach out to your respective area Ombudsman here: https://rbidocs.rbi.org.in/rdocs/Content/PDFs/AAOOSDT31012019.pdf.

Depending upon the nature of money transfer involved, RBI has given different settlement periods. Given below is the timeline of auto-reversal by the service provider and the compensation amount you are entitled to get in case of noncompliance by the service provider.

Description of incident Timeline of auto-reversal Compensation payable
Customer account debited but cash not dispensed from ATM including micro-ATMs Reversal of failed transaction within a maximum of T+5 days Rs 100 per day for delay beyond T+5 days, to the credit of account holder.
Card account debited but beneficiary card account not credited in case of card to card transfer Transaction to be reversed within T+1 day if credit is not effected to the beneficiary account Rs 100 per day for delay beyond T+1 day
Account debited but confirmation not received at merchant location, i.e., charge-slip not generated Auto-reversal within T+5 days Rs 100 per day of delay beyond T+5 days
Transaction on e-commerce websites where account is debited but confirmation not received at merchant’s system Auto-reversal within T+5 days Rs 100 per day of delay beyond T+5 days
IMPS transaction – account debited but beneficiary account is not credited If unable to credit, auto-reversal in T+1 day Rs 100 per day if delay is beyond the T+1 day
Transfer of funds via UPI payments – Account debited but beneficiary account is not credited If unable to credit to the beneficiary account, auto-reversal by the beneficiary bank by T+1 day Rs 100 per day if delay is beyond T+1 day
Payment made to merchant via UPI – Account debited but transaction confirmation not received at merchant location Auto-reversal within T+5 days Rs 100 per day if delay is beyond T+5 days
Account debited but transaction confirmed not received at merchant location for payments made by Aadhaar Enabled Payment System including Aadhaar Pay Acquirer to initiate “Credit Adjustment ” within T+5 days Rs 100 per day if delay is beyond T+5 days
Account debited but beneficiary account not credited for payments made by Aadhaar Enabled Payment System including Aadhaar Pay Acquirer to initiate “Credit Adjustment ” within T+5 days Rs 100 per day if delay is beyond T+5 days
Delay in crediting beneficiary’s account for payments made via Aadhaar Payment Bridge System (APBS) Beneficiary bank to reverse the transaction within T+1 day Rs 100 per day if delay is beyond T+1 day.
Delay in crediting beneficiary’s account of reversal of amount for payment made via NACH Beneficiary bank to reverse the uncredited transaction within T+1 day Rs 100 per day if the delay is beyond T+1 day
Account debited despite revocation of debit mandate with the bank by the customer for NACH payments Customer’s bank will be responsible for such debits. Resolution to be completed within T+1 day Rs 100 per day if the delay is beyond T+1 day
Payments made via card or mobile wallets where two different banks are involved, then such transactions will be done using UPI, debit/card, IMPS etc. Reversal of money in such cases will be done as mandated by UPI, Card or IMPS as mentioned above. Compensation will be paid accordingly as per the method used to make payment
Payments made via card or mobile wallet but beneficiary account is not credited ; the transaction is done within the same bank or same mobile wallet Reversal to de done in Remitter’s (initiator) account within T+1 day Rs 100 per day if delay is beyond T+1 day
Payment made via card or mobile wallet but transaction confirmation not received at the merchant location for payment done within the same bank or same mobile wallet Reversal to de done in Remitter’s (initiator) account within T+1 day Rs 100 per day if delay is beyond T+1 day
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*T refers to the day of the transaction

Source: RBI





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