In this era of Digital India, UPI, Debit Card and ATM have become an integral part of our everyday life. But it often happens that you scan the QR code at the shop, swipe the card at the POS machine or withdraw cash from the ATM, and the message ‘Transaction Failed’ appears on the screen. You get a shock when you receive an SMS on your mobile about money being deducted from your account. In such a situation, the common customer gets nervous and starts making rounds of the bank. But do you know that according to the rules of the Reserve Bank of India (RBI), if the bank does not return your deducted money within the stipulated time limit, then it will be returned to the customer. ₹100 per day According to which, is it mandatory to give compensation?
The Reserve Bank of India has implemented the ‘Harmonization of Turn Around Time (TAT) and Customer Compensation’ framework to make digital and electronic payments secure and reliable. The basic objective of this rule is to ensure that if a customer’s money gets stuck due to a technical glitch, the bank takes suo motu cognizance and credits it back to the account within the stipulated days. If the bank delays beyond the stipulated time limit, a compensation of ₹ 100 per day should be deposited directly into the customer’s bank account even without the customer asking for it.
RBI has fixed the deadline for auto-reversal for all types of payment systems, which is counted on the basis of ‘T’ (day of transaction):
| Payment Type | Situation | Auto-Reversal Time Limit (TAT) | compensation for delay |
| ATM (ATM / Micro-ATM) | Money deducted from account but cash not withdrawn | maximum T+5 days | ₹100 per day (after T+5) |
| UPI (UPI P2P / P2M) | Money deducted from account but not delivered to receiver | maximum T+1 day | ₹100 per day (after T+1) |
| Card Transaction (POS / E-Commerce) | Merchant did not get confirmation on payment deduction | maximum T+5 days | ₹100 per day (after T+5) |
| IMPS/NEFT | Money deducted from account but not credited to beneficiary account | maximum T+1 day | ₹100 per day (after T+1) |
| Aadhaar Enabled Payment (AePS) | Customer’s account debited but transaction unsuccessful | maximum T+5 days | ₹100 per day (after T+5) |
Note: Here ‘T’ stands for date of transaction.
There are clear instructions from RBI that this compensation is payable to the customer only if the error is due to banking system or technical failure. For example:
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Not withdrawing cash from ATM: You entered the PIN to withdraw ₹5,000, the machine made a sound but the cash did not come out and the amount was deducted from the account. The bank has to return the money within the next 5 days (T+5) from the date of transaction. If the bank returns the money on the 10th day, an additional compensation of ₹500 will be given for the delay of 5 days.
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UPI payment failure: You sent ₹2,000 to a shopkeeper, it was deducted from your account but did not reach the shopkeeper’s account. For this the bank has only T+1 days time. After this, for every day of delay, ₹ 100 will be added per day.
It is also important to know in which cases the fine of ₹100 does not apply:
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Customer fault: If you enter the wrong UPI ID or wrong account number and the money goes to someone else’s account, it is not considered a technical failure of the bank.
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Non-filing of complaint in time (in case of ATM): In case of ATM failures the customer should lodge a complaint with his bank within 30 days from the date of transaction.
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Fraud or Cyber Crime: If a user has become a victim of cyber fraud due to sharing OTP or clicking on a phishing link, then he does not come under the purview of this auto-reversal TAT rule.
If your transaction has failed and money has been deducted, follow these steps:
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Preserve Evidence: Save the transaction screenshot, UTR number, bank SMS, ATM transaction slip or failure receipt.
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File a complaint with your bank: Register your complaint immediately by visiting the helpline, net banking or nearest branch of the bank where you have an account (card issuing bank) and take the ticket/complaint reference number.
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Wait till TAT period: Wait 24-48 hours for UPI and up to 5 working days for ATM/Card.
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Check Damages: If the refund arrives after the due date, check the bank statement to see whether the bank has credited a penalty of ₹100 per day along with the principal amount.
If the bank does not refund even after the stipulated time limit has passed or refuses to pay compensation of ₹100 per day despite delay, the customer has the legal right to:
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Nodal Officer (Grievance Officer): First of all send an email to the Principal Grievance Redressal Officer of the bank.
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RBI Ombudsman: If the bank does not provide resolution within 30 days or gives an unsatisfactory response, you can lodge a complaint through the Online Complaint Management System portal of the Reserve Bank of India (RBI).cms.rbi.org.in) but you can file a complaint directly with the Lokpal without any fee. The RBI Ombudsman issues an order to the bank to pay the full compensation along with the principal amount.