FINDING SOLUTIONS TO DIGITAL PAYMENT PROBLEMS
In case of incorrect transactions, banks and mobile wallets give some assistance. Things get tougher when there is a payment failure
There’s disruption happening in the Indian payments space. Since demonetisation took place a year ago, both banks and ewallets are aggressively promoting digital payments. And, many individuals who were happy using cash have had to go the digital way.
It’s not easy. While everything is just ‘a click’ or ‘a scan’ away sounds great, it comes with a host of issues. Individuals new to a digital payments system can end up transferring money to a wrong account. Or as happens sometimes, transactions simply fail.
Take Mumbai-based Raman Masurkar, 30, a software developer. Rather than transferring money to his friend in Mumbai, he sent it to a hotel with the same name in Manali. When he visited his bank, he was told there’s little they could do but they would still try with the beneficiary’s bank, based on his written complaint. “Thankfully, the hotel owner transferred back the money after three days,” says Masurkar. The good news: Even the regulator has said that for all incorrect transactions the account owner is responsible, many banks, wallets and card companies do help customers. But, in transaction failures where funds are not credited back, the customer has to chase his bank or wallet company until the problem is resolved. Initial hiccups: Things are moving so fast in the payments space that even savvy users find it difficult to keep pace. Recently, the Reserve Bank of India (RBI) allowed wallets to use Unified Payment Interface (UPI) that will let users transfer money from one wallet to another. National Payments Corporation of India (NPCI) is working on UPI 2.0, with newer features like a Quick Response Code and standing instructions. The digital payments industry in India is projected to reach $500 billion by 2020, or 15 per cent of gross domestic product (GDP), according to a Google and Boston Consulting Group report. This is around 10 times of what it was last year.
“The payments space is in choppy waters, as the landscape has exploded recently. Existing players need to constantly upgrade their systems and infrastructure, as newer technology comes in, and the number of transactions rises. Users are bound to face payment reconciliation problems with companies that continue with legacy systems,” says Sampad Swain, co-founder and chief executive officer (CEO) of Instamojo, a payments gateway company. Money sent to wrong beneficiary: If you are using net banking and transfer money to a wrong beneficiary like Masurkar did, e-mail the bank immediately, describing the problem, with details of accounts involved. Also, visit the branch with the same letter and meet the manager. Explains Jitesh PV, head – digital, Federal Bank: “Other than the written request, the customer has to give an indemnity letter in case there’s a dispute in the future.”
The sender’s bank will then approach the bank of the fund receiver and request for reversing the transaction. Only after the receiver confirms it is an incorrect transaction and gives consent for reversing it will the sender get back his money. In case there’s an incorrect transfer when using a mobile wallet, the user needs to follow the same procedure, according to Vinay Kalantri, founder and managing director, The Mobile Wallet. Transaction failed but money is not credited: Transaction failures are not rare. The most common reason for this is internet connectivity. In such cases, the funds should come back to the sender’s account within 48 hours.
There are cases when it can take much longer. Kolkata-based Aniruddha Roy was purchasing a film ticket online when the transaction got stuck in the last leg, when he was supposed to get a confirmation message. But, the bank sent an SMS that the transaction was successful. When the money was not reversed after two days, he approached the bank. “It took more than three weeks to get the money, after constantly following up with the bank,” says Roy. Such occurrences are rare but do happen. “In certain cases, the bank or wallet company has to wait for the merchant to reconcile payments, which can take time. A bank or wallet cannot reverse the transaction until the merchant reconciles,” says Kalantri. To get the money back, there is no option but to constantly follow up with the bank or mobile wallet. “In payments systems, it’s not impossible to find out where the problem is. But, the bank, card or wallet player needs to actively pursue the settlement for faster resolution,” says Swain. In the case of an ATM machine not dispensing cash, it takes more than seven working days and the individual needs to follow the same procedure. If it takes longer, the bank has to pay ~100 for each day of delay, according to RBI guidelines. Where reversal is not possible: A bank may help if you made a mistake. But, reversing a transaction is not possible if the sender wants the money back because of a dispute with the beneficiary over goods or services.
The reversal is also not possible if you make a mistake when transacting with a merchant. It holds true for banks, wallets and even credit cards. “An authorised transaction cannot be cancelled by the card issuer. If a customer is charged for a transaction not carried out by him, he should promptly reach out to the issuer to get the card blocked and raise a dispute,” says Vijay Jasuja, CEO, SBI Card. So, when recharging mobile, for example, you enter an amount of ~1,000 instead of ~100 or you enter an incorrect mobile number, you will not get the money back.
There are times when card transactions don’t go through but the cardholder gets an SMS that the money is debited. The merchant may swipe the card again. In the majority of cases, failed transactions are reversed within eight days. But, what if both the transactions are authorised? “In the unlikely event of the merchant posting both the duplicate transactions to the customer’s credit card, the customer may write or call our correspondence channels with requisite details. In such a scenario, a chargeback would be raised against the dispute, the resolution of which may take up to 90 days, in line with the Visa or MasterCard guidelines,” says Jasuja.