The new UPI chargeback system being introduced by the National Payments Corporation of India (NPCI) will also provide relief to such customers whose refund claims were rejected earlier.
In the new rules, banks have been given the freedom to re-examine the old rejected cases. NPCI had found in December 2023 that some people were repeatedly doing chargebacks and misusing the system. Therefore, its limit was fixed.
If a customer did a chargeback more than 10 times in a month or more than five times with a single person, then his next refund claim was rejected, but now it is also believed that some genuine claims are also getting stopped due to these rules. Keeping this in mind, this new system has been introduced.
Banks will re-examine old cases
The new chargeback system will work in conjunction with the existing claim process and will give banks the added advantage of being able to re-examine previously rejected cases. The biggest benefit of this change will be to consumers as they will not have to file complaints again and again. Banks will automatically identify which cases are refundable and will be able to restart the refund process based on that.
Eliminate the need for permission
Under the new rules, banks will no longer need to seek separate approval from NPCI to refund money. Under this new system, if a transaction fails or due to technical fault, money is deducted from the customer’s account but does not reach the beneficiary, then the bank will be able to send that transaction directly to NPCI again and start the refund process.
Who will benefit?
1. Customers will get their money back quickly, chances of fraud will be reduced.
2. Banks’ time will be saved, they will not have to wait for NPCI’s approval.
3. Trust and transparency will increase in the government’s digital payment system.
What to do in case of a wrong transaction?
1. Contact bank: Inform your bank or UPI service provider (e.g. Google Pay, PhonePe) immediately. Provide details like transaction ID, amount, date and incorrect UPI ID.
2. Contact the recipient: If the recipient’s phone number or UPI ID is available, request them to refund the amount.
3. Complain to NPCI: If no solution is found, lodge a complaint on NPCI website.
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