Instant Refunds

Paytm now enables merchants to provide instant refunds to their customers in their bank accounts. Historically, depending on the payment method used by the customer, the time taken to refund the amount would vary between 3-5 days. This delay undoubtedly provides bad customer experience and higher customer escalations.

Please note: Instant refund is only available to select enterprise merchants who have integrated online or in-app payments with Paytm for their Business. Get in touch to request access to an instant refund for your account.

Getting started with instant refunds

Instant refund is a three-step process:

Step 1: Check eligibility of a transaction for an instant refund

The instant refund should only be provided for payments made via Debit Card, Netbanking, and UPI. Instant refund for Credit Card transactions should be enabled with caution – you should prevent customers from availing free credit by cancelling orders and accepting refund in a bank account. Refunds for orders paid via Paytm Wallet and Paytm Postpaid are always instant by default and made to the respective method.

Step 2: Getting refund destination details for a customer

The merchant is expected to create a flow wherein you take customer’s bank account details to initiate a refund. These bank account details have to be validated with Paytm. On successful validation, Paytm return a customer asset token to initiate the refund.

Step 3: Initiate a refund

Pass the customer asset token in the refund request. Paytm processes the refund in the bank account of the customer after validating this token.

Types of refunds

Merchant Initiated Refund

These refunds occur when the merchant is unable to fulfil the order due to stock unavailability or any other reason.

Customer Initiated Refund

These refunds happen when a customer has changed their mind about purchase or service pre/post order fulfilment.

Note: In case of customer-initiated refund, bank account details should be taken as soon as the customer has initiated the refund (by cancelling an order) in your app or website. In merchant initiated refund, a notification (SMS, Email, push) needs to be triggered by the merchant with a direct link to app or website where customers can input the bank account information. The sample user journey is provided for reference below: