Fintech unicorn Razorpay has launched instant refunds for failed Unified Payments Interface (UPI) transactions on its POS devices to allow merchants to offer a more seamless payment experience to their customers.
In a statement, the startup claimed that the “industry-first solution” would reduce the time taken to provide refunds for failed UPI transactions to just 2 minutes against industry standard of 5-6 business days.
Citing a survey conducted last year, the fintech startup said that a majority of MSME retailers highlighted internet issues and failed transactions as a big challenge in the use of UPI transactions for business.
The new technology will initiate a refund attempt within 3 seconds of the failure of a UPI transaction. In case of a failure, the startup’s POS devices will attempt to complete the transaction thrice automatically, with each attempt spaced 5 seconds apart.
Commenting on the development, Razorpay POS CEO Byas Nambisan said, “According to our data, 5-15% of UPI transactions see friction due to pending status and our merchants lose their business in 30-40% of the cases wherein the customer is not comfortable making a double payment via UPI or paying through any other method…This new offering reiterates our goal of simplifying money movement…”
Razorpay’s POS offerings include Android Smart POS, Android Smart Mini POS, and soundbox. In December, the unicorn claimed that its POS business clocked a 60% growth in the financial year 2022-23 (FY23) following the acquisition of Ezetap.
Razorpay acquired Ezetap in 2022 in a deal valued at about $100-$120 Mn.
Founded in 2014 by Shashank Kumar and Harshil Mathur, Razorpay provides payment gateway, SME payroll management, banking, lending, payments, and insurance services, among others. The startup has raised over $700 Mn in funding till date and counts the likes of GIC, Tiger Global, Peak XV, Ribbit Capital, and Matrix Partners among its investors.
In December last year, Razorpay received the final approval from the Reserve Bank of India (RBI) to operate as a payment aggregator. This also paved the way for the startup to start onboarding new customers.
Razorpay is said to be among the many Indian startups which are planning to reverse flip and shift their base to India. The startup is yet to file its financial statements for FY23. In FY22, it posted a standalone net profit of INR 7.3 Cr, while operating revenue surged 76% year-on-year to INR 1,481 Cr.
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