The Reserve Bank of India (RBI) on Friday released a framework for turnaround time (TAT) for failed transactions and compensation for customers, saying this will bring in uniformity in processing of the failed transactions.
The central bank also prescribed auto reversal timelines for failed transactions. In cases where a customer’s account has been debited but cash not dispensed from an automated teller machine (ATM), the bank will have to pro-actively reverse failed transactions within a maximum of T + 5 days or within five days of the failed transaction. Failing to reverse within five days will lead to the bank paying ₹100 per day to the account holder.
In the case of point of sale (PoS) transactions and including cash at PoS, where account is debited but confirmation not received at merchant location or charge-slip not generated, the same five-day reversal period has been granted.
For Immediate Payment System (IMPS) and Unified Payments Interface (UPI) transactions, the central bank has asked banks to reverse it within a day of the failed transaction.
A failed transaction is one which has not been fully completed due to any reason not attributable to the customer such as failure in communication links, non-availability of cash in an ATM and time-out of sessions. Failed transactions shall also include the credits which could not be effected to the beneficiary account on account of lack of full information or lack of proper information and delay in initiating a reversal transaction.
RBI said that the prescribed timelines are the outer limit for resolution of failed transactions and banks and other operators shall try quicker resolution of these transactions.
“It has been observed that a large number of customer complaints emanate on account of unsuccessful or ‘failed’ transactions. Rectification and compensation paid to the customer for these ‘failed’ transactions is not uniform," RBI said.
In its Statement on Developmental and Regulatory policies issued as part of Monetary Policy statement on 4 April, RBI had said it would put in place a framework on Turnaround Time (TAT) for resolution of customer complaints and a compensation framework.