Digital payments have become very popular in India. Most people now prefer to use digital methods for transactions because they are easy and fast. However, sometimes payments fail, or money gets stuck, causing problems for users. People often worry about when they will get their refund. To solve this issue, a new UPI rule has been introduced.
New UPI Rule from February 15, 2025
The National Payments Corporation of India (NPCI) has announced new UPI transaction rules, effective from February 15, 2025. These changes will automate the chargeback (refund) process, making it quicker for customers to receive refunds and easier for banks to process them.
What is the New Rule?
Previously, when a UPI transaction failed, banks started the chargeback process on the same day (T+0). However, this did not give enough time for the recipient to process the refund, leading to rejections and even penalties from the Reserve Bank of India (RBI).
Now, a new system called “Transaction Credit Confirmation (TCC)” will be used. This system will automatically approve or reject chargebacks without manual verification, making the process faster. According to NPCI, this rule will only apply to bulk uploads and UDIR (Unified Dispute Resolution Interface) cases. It will not affect complaints made directly by customers.
Why Do Chargebacks Happen?
Chargebacks occur when a previously approved UPI transaction is reversed. Some common reasons include:
- The customer does not recognize the payment.
- A technical error leads to duplicate payments.
- The customer paid for a product or service but did not receive it correctly.
- Issues in transaction processing due to system errors.
Benefits of the New Rule
- Customers will get refunds faster.
- Banks will have more time to verify transactions.
- Fraud and unnecessary disputes will be reduced.
- It will help banks avoid RBI penalties.
- The process will be more transparent and efficient.