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Refunds

Refund are reversal transactions wherein complete or partial money is moved back to customer’s source account (account from which actual payment was made). A refund can only be created for a successful or settled transaction. Use case for a refund arises in the following scenarios:

  • Customer initiated refund (returns/cancellation) - Customer has changed his mind about the consumption of product pre/post order delivery

  • Merchant initiated refund - Refund can be initiated by the merchant in the following scenarios:

    • Product/service is out of stock

    • Merchant works on a prepaid model wherein the initial amount was higher than the final billed amount (prepaid service model)

    • Mismatch in transaction status between Paytm and merchant wherein transaction is failed state at merchant's end but is successful at Paytm's end.

You can initiate partial or complete refunds to your customer’s source account. A refund request usually takes 7-14 business days to reflect in customer’s account depending on the bank used for payment.

Ways to initiate refunds

Paytm provides two ways by which you can initiate refunds:

 

You can also initiate a refund via the Refund API. The identifier of a transaction against which refund has to be made is order ID (unique parameter for order in your system) and transaction ID (unique parameter for your order with Paytm passed in transaction response).

 

 

Steps for Refund API

  1. Initiate refund from your backend using our Refund API.

  2. Paytm validates the refund against the original order. These are basic validations like a cumulative refund on this order < order value, the order is not more than a year old etc.

  3. Sync confirmation after validation of refund is provided in response to the Refund API request.

  4. Once the refund is validated at Paytm's end, Paytm deducts the refund amount from your pending settlement amount.

  5. On successful deduction, Paytm sends an Accept Refund Webhook to the merchant.

  6. Post successful deduction Paytm initiates the refund to the bank. Apart from net banking refunds, this is instant in nature. Most of the net banking refunds are file-based and hence are sent to the bank on the next working day.

  7. Once the bank accepts the refund, Paytm sends a Success Refund Webhook to the merchant. This webhook depicts that refund has been initiated and contains the latest date by which money will be credited into the user's account.

  8. At any point of time, the detailed information of refund can be fetched using the Refund Status API.

Constraints on refunds

  • Once the refund is requested against a transaction, it cannot be cancelled by the merchant.

  • Refund request will always be credited to customer source account with which the transaction was done initially.

  • Refunds can be requested for a successful, settled, or partially refunded orders.

  • Total refund initiated in a day has to be lower than total outstanding payable amount with Paytm. In case it is more, the refunds are not accepted.

  • Total 6 partial refunds are allowed on a single transaction done using the Rupay card network.

  • For wallet transaction where the Paytm cashback (CB) has been processed successfully, the customer will receive a refund after deduction of CB.