UPI has become a part of daily life in India. From buying groceries to paying rent and shopping online, apps like Google Pay, PhonePe, and Paytm make payments quick and easy.
But problems arise when money gets deducted from your account and does not reach the receiver.
What many users don’t know is that RBI rules allow not just a refund, but compensation as well in certain cases.
Here’s everything you need to know, explained simply.
What Happens When a UPI Payment Fails?
If a UPI transaction fails but the amount is deducted from your bank account, the responsibility lies with the bank or UPI service provider.
In most cases, the deducted amount is automatically refunded within one working day.
Sometimes the refund is instant, but delays can happen due to technical issues.
If the delay goes beyond the allowed time, compensation may apply.
When Are You Eligible for Compensation?
As per RBI and NPCI guidelines, compensation is given only if the delay is caused by the bank, server, or UPI app.
This means you are entitled to compensation if:
The failed transaction is not resolved within the prescribed timeline
The fault is on the service provider’s side
Compensation is provided in addition to the refund, not as a replacement.
How Much Compensation Can You Get?
The compensation amount depends on how long the delay lasts.
RBI has set a daily penalty system for unresolved failed transactions.
While the amount is usually small, it is your right as a user.
This rule ensures banks and apps handle payment issues responsibly and on time.
How to File a Complaint for a Failed UPI Payment
If your money is deducted and not refunded, follow these steps:
First, open the same UPI app you used for the payment.
Go to Transaction History and select the failed transaction.
Tap on Help, Support, or Report a Problem.
Enter the UTR number or transaction ID and submit your complaint.
Most issues are resolved at this stage.
Not All Failed Transactions Qualify for Compensation
It’s important to know that compensation is not applicable in every case.
You will not get compensation if:
You entered the wrong UPI ID
The transaction was immediately reversed
The failure happened due to user error
Only delays caused by banks or apps are considered for compensation.
What to Do If the Issue Is Still Not Resolved?
If the UPI app or bank does not resolve your complaint, you can escalate the issue.
You may file a complaint on the NPCI or RBI complaint portal.
These complaints are reviewed carefully, and if found valid, users can receive both a refund and compensation.
Important Tips to Avoid UPI Issues
Always double-check the UPI ID before confirming a payment.
Ensure a stable internet connection while making transactions.
Do not close the app until the payment status is confirmed.
Keep screenshots or transaction details for future reference.
Knowing your rights can save you money and stress. If a UPI payment fails, don’t panic—follow the process and claim what you’re entitled to.
