Razorpay announces instant refunds for failed UPI transactions, here’s what it means for users

Fintech platform

Razorpay

has introduced a new feature -- instant refunds -- for failed

UPI

transactions. The new feature is available across the country on the Razorpay platform.
Razorpay to offer instant refunds for failed UPI transactions
Razorpay has confirmed that it will offer refunds to users within two minutes for every failed transaction made using UPI, instead of the standard 5-8 business days as per the standard practice followed by other platforms in the country.

The company also says that this is the industry's first feature.

Razorpay has confirmed that more than 15 per cent of UPI transactions get stuck at the pending status and that results in merchants and sellers losing around 40 per cent of business considering customers don’t usually make the payment twice thinking the money will be dedicated twice from their accounts.
Byas Nambisan

, CEO, Razorpay POS, mentioned that "It was critical for us to nip this in the bud by empowering our merchants to make these instant refunds happen, enhancing customer satisfaction, trust, and faster checkouts.”

What it means for users
Razorpay is a payment gateway used by many platforms for accepting payments. The implementation of an instant refund feature will enable users to get their money back, in case of failed transactions, instantly and retry the payment again.
This brings two things for users -- security of their deducted amount in case the payment fails, and ensures that they can retry again given then money will be credited back into their account in a few minutes.
UPI payments crossed the 100 billion mark in 2023 showcasing a growth of around 60 per cent, according to the

National Payments Corporation of India

(NPCI) report.