A Quick ‘Refund Guide’ why Refund Takes Time to Reach Customers?


In today’s digital world, everything is done online. Be it shopping, paying bills, or ordering food, most people prefer to do it the quick and easy way through online payments. These online payments not only help save the time and energy of going in person to the store or paying with cash, but they are also secure. But in certain situations, customers might cancel their orders or return their products to the merchant and ask for a payment refund. These refunds generally take 4 to 7 days to reach the customers.

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    What is a Payment Refund?

    A payment refund is a process where the merchant returns the money paid by the customer for a particular service. In this process, the customer sends a refund request to the merchant, to which the merchant responds by initiating the refund process and sending money back to the customer’s bank account. It usually takes up to 3 to 7 business days to refund the amount.

    Customers have to check the refund policy of the merchants before requesting a refund. Some businesses offer a full refund, while others offer only a partial refund. If the business only offers a partial refund, a specific amount of money will be credited to the customer’s account instead of the full sum.


    Why do Customers Ask for a Refund?

    Customers can request a refund for several reasons. Here are some of the instances where customers ask for a refund from their merchants.

    • The quality of the product received is not up to the customer’s expectations.
    • The customers received damaged or old products. 
    • The customer canceled the order after making the payment. 
    • Sometimes the payment systems may encounter some glitches. This will lead to the funds being transferred twice to the merchants. 
    • The customer either ordered the wrong product or the merchant delivered the wrong product.

    How and why do Payments Fail?

    A transaction can fail for multiple reasons. There might be some technical faults with the payment systems, or there might be some network issues in your area. Whatever the reason, if the funds are debited from the customer’s account, and yet they are notified that the transaction failed, the customers have all the rights to request a transaction. 

    The payments can also be declared failed if the merchant’s bank fails to notify the payment gateway of the result of the transaction. If the payment gateway does not receive any updates from the merchant bank after the transaction, there is a high chance it will declare the transaction failed. Each party involved in the transaction process should work together for a successful transaction. 

    Process Involved in Payment Refund

    Certain parties are involved while making an online payment: customer, customer’s bank account, card schemes, payment gateway, payment processor, and merchant’s bank account. All these parties are involved in the payment refund process too. Below is the process that is undergone when a customer asks for a refund.

    • The customer sends a payment refund request to the merchant.
    • The refund request is processed and forwarded to the merchant’s bank by the payment gateway
    • The merchant’s bank verifies the refund request and communicates the information to the customer’s bank through the payment gateway. 
    • Once all the parties involved approve the transaction, the refund is processed.

    If the customer opts for a refund due to a product return, they should first send a return request to the merchant. The refund process will only occur if the merchant approves the return of the product. 

    Why does a Refund take Time to Reach Customers?

    Three main parties are involved in a successful payment refund – the payment gateway, the merchant’s bank, and the customer’s bank. Refunds take longer than transactions because they have to go through an elaborate process and involve the combined work of various systems. Below are some of the reasons why refunds take a long time to reach customers.

    • The refunds may not be processed during weekends or during public holidays since the banks will be on leave.
    • Glitches and technical faults in the network or payment gateway hinder a smooth refund process.
    • The involvement of multiple parties in the refund process may take longer to be processed.

    Sometimes, the refund request can be dropped due to technical difficulties. In such cases, the customer has to re-initiate the refund process to receive the money. 

    Importance of Quicker Refunds

    A faster refund process can help develop merchant-customer trust and motivate customers to purchase again. Processing the refund and transferring the funds quickly can improve the reputation of the business and build trust among customers. The merchants should integrate their bank accounts with a strong and automated payment system to ensure a smooth and fast refund experience. 

    NTT DATA Payment Services

    NTT DATA Payment Services is one of the top online payment service providers that offers a 360-degree payment solution to its clients. They serve over 6 million merchants across industry verticals. They offer online and offline payment services with over 100 payment options to their clients. Some of their services are, 

    • Online Payment Gateway
    • POS Machines
    • QR Code
    • IVR
    • Mobile Application

    NTT DATA Payment Services provides a secure and seamless payment experience to their clients and helps them accept and manage payments effectively and effortlessly. Some of the benefits of NTT DATA Payment Services are high transaction success rates, multiple payment options, instant fund settlements, etc. It offers a customized payment solution for merchants across different fields such as travel, education, gaming, healthcare, retail, government, broking, hospitality, etc.


    Payment refunds are a common occurrence in online payments. Thus, it is important for merchants to have a quick and convenient gateway to make the refund process smoother and without errors. NTT DATA offers a quick and secure refund process for their customers. If you are a merchant looking for a high-quality payment service provider that facilitates a smooth payment refund, then NTT DATA Payment Services is your best choice. 


    1. What is the note refund policy?

    According to the RBI’s bank notes exchange (Note Refund) policy 2009, people can exchange their damaged currency notes with their nearest banks. No banks are allowed to decline the exchange. If they do, people can file a complaint against the bank. To learn more about this policy, click here.

    2. Can I be denied a refund?

    The approval of your refund depends on why you requested the refund. If you wish for a refund for a product supplied that is damaged or faulty, then you are entitled to a refund from the merchant. But if you want a refund just because you don’t like a product or don’t feel like using it, that’s not a good enough reason to request a refund. The merchant can reject your refund. Although, the refund policy is at the sole discretion of the merchant who has provided the customer with the goods or service.

    3. How long does it take for payment refunds?

    Payment refunds are usually done within 3 to 5 business days, but in certain cases, they might even take up to 15 to 30 days. Customers may be required to resend the refund request if the refund takes too long to be credited to their account.

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