Faster Refunds, Fewer Escalations: Solving Operational Bottlenecks with UDIR

Every customer knows the wait. You cancel an order or request a refund, and then comes the dreaded line: “Refunds will be processed in 5–7 business days.”

While customers groan and refresh their apps, merchants are stuck too — in a black box of uncertainty.

The Missing Link: Visibility#

Refund Status Tracking#

Today, most merchants initiate a refund through traditional payment rails which are often file based or manual back office processes and…that’s it. There’s no feedback loop. No confirmation if it landed.

The only time a merchant learns of a failed refund is when a customer is already frustrated or they are slapped with a chargeback by the customer's bank.

These refund escalations don’t just drain support and reconciliation bandwidth, they put brand trust on the line. In highly competitive industries, they can be the difference between a repeat buyer and a lost customer.

We fixed this with a simple idea: give merchants complete visibility.

By integrating real-time refund status updates using UDIR rails, we enable businesses to track exactly when the refund hits the customer's account. We let them initiate refunds using APIs baked in fallback and let them know when the refund is successful.

Faster Refunds, Without the Friction#

Now let’s talk about speed. Instant refunds are already being offered by some platforms but behind the scenes, it’s anything but seamless.

To make this work, businesses often maintain pre-funded accounts just for refunds. These are operationally heavy and technically clunky — requiring manual effort, custom workflows, constant monitoring, and advance funding. This increases costs for merchants and completely locks out small & medium businesses who cannot pre-fund their accounts. It’s a patchy solution which is costly to maintain and prone to cracks.

Even if you solve for speed, there's one more challenge that sneaks in — security.#

When refunds aren’t tied to the original transaction, they open up a potential loophole that can lead to fraud and chargebacks. In some cases, users can falsely claim that a refund wasn’t issued or that a service wasn’t delivered and raise disputes via NPCI. That’s where UDIR changes the game.

UPI UDIR#

By leveraging UDIR, one can enable truly instant refunds directly tied to the original transaction. Instead of creating a new transaction, UDIR processes the refund as a secure reversal of the original transaction. It tracks refunds on the basis of original transaction id. In case of any disputes arising on transactions that have already been refunded, our system instantly acknowledges and closes the complaint without any additional effort from the merchant.

It's fast, seamless and a part of the same payment trail.

A Win-Win: Lower Costs, Higher Customer Loyalty#

This solution gives merchants the tools to deliver on a critical but often neglected part of customer experience: trust after a transaction.

This isn’t just a tech upgrade, it’s a shift in how refunds are seen.

• Automatic dispute handling on refunded transactions
• Instant refunds
• Refund status tracking
• Lower operational overhead
• Higher NPS & customer retention

In short, refunds stop being a cost center and become a loyalty driver!