Razorpay Unveils Groundbreaking 'Instant Refunds' Feature for Failed UPI Transactions

In a major stride towards customer convenience, Razorpay, the full-stack fintech platform based in New Delhi, introduced a pioneering ‘instant refunds’ feature for failed Unified Payments Interface (UPI) transactions on Monday. This solution, brought forth by Razorpay POS, ensures swift reimbursement within two minutes, significantly outpacing the industry standard of 5-6 business days.

Byas Nambisan, CEO of Razorpay POS, highlighted the importance of this innovation, stating that 5-15% of UPI transactions encounter obstacles leading to pending status. In such cases, merchants face business losses ranging from 30-40% when customers are hesitant to make double payments via UPI or opt for alternative payment methods.

Nambisan emphasized the critical need to address this issue promptly, aiming to empower merchants with the ability to provide instant refunds. This not only enhances customer satisfaction and trust but also streamlines the checkout process for faster transactions.

In December of the previous year, Razorpay POS reported an impressive 60% growth in FY23, contributing nearly 10% to the company’s overall revenue. The platform has garnered substantial investments, with key backers including Lone Pine Capital, Alkeon Capital, TCV, GIC, Tiger Global, Sequoia Capital India, Ribbit Capital, Matrix Partners, Salesforce Ventures, Y Combinator, and MasterCard, totalling $741.5 million.

The move comes at a time when UPI transactions in 2023 surpassed 100 billion, reaching approximately 118 billion, signifying a remarkable 60% growth from the previous year’s 74 billion, according to the National Payments Corporation of India (NPCI).