Process Refunds & Settle Chargebacks 24×7 with Paytm Refund Advance Account

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Returned orders are a challenge that online businesses have to tackle quickly yet efficiently. Customers keep returning products all the time. It can be due to receiving:

  • a wrong product,
  • a product that looks different from what was shown on the online store,
  • a damaged product,
  • or a customer simply changing their mind about a particular purchase

Let’s admit it! A good return policy is one of the basic requirements that customers expect from online stores.

As per the June 2021 Global Consumer Insights Pulse Survey by PwC, 31% of the respondents rated ‘A good return policy’ as the third most important attribute when shopping online.

Most brick-and-mortar stores offer a return policy to their customers. Online need to follow suit as their customers do not get to hold or see the physical product before buying it.

However, small and medium-sized online businesses struggle to keep up with their customers’ expectations of offering a good return policy.

It is due to the lack of tech resources required for developing the return functionality into the online store. That’s where Paytm comes to the rescue.

Pain points businesses face when it comes to processing customer refunds

In India at present, businesses, whether new or old, are aggressively taking the online route to take themselves to the next level, especially after the pandemic hit.

As per the 2021 Global Payments Report by Worldpay FIS, the Indian e-commerce industry is estimated to grow 84% to $111 billion by 2024.

While these statistics instill a lot of hope into aspiring e-commerce entrepreneurs, there is bound to be stiff competition.

And one of the critical factors that will help online businesses survive this competition is how well they serve their customers. When you keep customers at the center of everything you do, your online business will face fewer chargebacks as customer trust grows into your business over time.

Also Read: The Refund Challenge: Four Common Issues E-commerce Sites Face with Refunds

The issue of chargebacks

Yes, it is all about customer experience! However, equally important is the merchant experience with a particular product. On the flip side of customer refunds is the settlement of chargeback, which happens between the merchants and the banks.

For the uninitiated, when a business is liable to refund a customer’s money for reasons that may be in their favor, it is called a chargeback.

There can be many reasons for chargebacks, for example, clerical, technical, quality-related or even fraud-related.

When a customer disputes a payment for whatever reason (return, fraud, etc.) the merchant has to reverse the amount. Usually, the reversal is done from the merchant account to the customer’s original payment source.

Generally, merchant acquiring banks charge a fee to merchants for chargeback transactions. The details of these fees are usually there in the merchant account agreement with the bank.

Usually, merchants have to wait until they have enough forward transactional balance into their account to settle chargebacks with the banks. Until these are settled, merchants cannot receive settlements in their bank account.

It further leads to liquidity challenges as the merchants cannot access their funds when they need them.

However, with a robust payment gateway, merchants can overcome this problem. How they can do it is explained next.

The solution – Paytm Refund Advance Account

Traditionally, online businesses get anywhere between 5 to 30 days to process refunds and settle chargebacks depending on the payment method chosen by the customer when making the payment.

What if we tell you that we have a solution that will cut short this waiting time to almost nothing for your customers? Sounds too good to be true, right? Well, we are making it possible with our brand-new offering – Paytm Refund Advance Account.

Paytm Refund Advance Account is a separate virtual account in which businesses can add funds themselves from any of their bank accounts at any time.

With the Paytm Payment Gateway, merchants can recharge their Paytm Refund Advance Account with funds on the go.

They can use these funds to process customer refunds and settle chargebacks without waiting for enough forward transactional balance to be accumulated in their account.

Benefits of Paytm Refund Advance Account

1. Improved customer refund experience/timelines.

Paytm Refund Advance Account helps online businesses, especially those offering festive sales/seasonal sales, deliver improved customer refund experiences.

Our product enables you to keep up with your promised customer refund initiation timelines whether you have enough forward transactional balance into your account or not.

You can issue refunds of any amount simply by funding this DIY account.

2. Easier reconciliation & fund management.

As they work with strict regulatory restrictions, easy reconciliations and fund management are critical benefits BFSI businesses can leverage with Paytm Refund Advance Account.

BFSIs are required to ensure that the forward transaction money lands only into the receiving account & any deductions against refunds are not allowed to be mixed with these forward remittances.

To comply with these regulations, BFSIs usually resort to an offline customer refund process for separately tracking and reconciling the backward movement of the money.

With Paytm Refund Advance Account, BFSIs can control this money movement from the same Business Dashboard. They can also download separate account ledgers with easy correlation to forward orders.

3. Make transaction-wise real-time settlements possible.

Many online businesses opt for real-time settlements as a part of the payment gateway solution and have two basic requirements:

  • Get real-time settlements multiple times in their account.
  • Enable transaction-level fund transfers in their account.

If these are not there, businesses have to wait for enough forward transactional balance in their account for processing backward fund flows.

However, by opening Paytm Refund Advance Account, online businesses can separate backward fund flows such as refunds and chargebacks.

4. Enable aggregator-level pre-funding.

Many huge offline businesses, especially in the LFR (Large Format Retail) category, have multiple online storefronts. They process customer refunds from a consolidated aggregator dashboard, as refunds issuance & refund money movement to customers are controlled centrally from the head office.

Paytm Refund Advance Account beautifully easies the life of such businesses by offering them aggregator-level refund accounts.

This solution saves individual storefronts from the hassles of initiating customer refunds and settling chargebacks to support forward transactions.

5. Get timely remaining balance notifications.

High TPS Businesses like e-commerce platforms want instant API-based notifications whenever their refund account balance reaches a defined threshold. It helps them to fund their account quickly without impacting their customer refunds.

Paytm Refund Advance Account solves this problem with its web hook configuration, which gets triggered whenever the account balance reaches a threshold.

Once your advance account balance goes below the specified limit, you will get a notification mentioning the same. These notifications also tell you the current available balance in the account and the details of the last refund processed.

For whom Paytm Refund Advance Account is relevant?

The DIY nature of the pre-fund account makes it ideal for virtually any business with refunds as a use case. It is especially relevant to:

  • BFSIs: As they cannot use the settlement money hitting their bank account to process customer refunds and settle chargebacks.
  • E-commerce Businesses: Given their uneven selling patterns, especially during festive sales/shopping festivals.
  • Large Offline Aggregators with Multiple Online Shop Fronts: A central Paytm Refund Advance Account can help such businesses process customer refunds and settle chargebacks against all their stores.
  • Businesses that Demand Real-Time Settlements: Businesses that wish to enable real-time settlements on a per transaction level without compromising their refund balance, like Online Gaming Businesses.

Paytm Refund Advance Account + Paytm Instant Refunds = Customer refunds made easy

Paytm is committed to enabling small and mid-sized businesses to deliver world-class customer experiences without spending time, effort and money into building superior functionalities on their own.

We strive to make enterprise-grade solutions accessible to small and medium-sized businesses without burning a hole into their pocket. Paytm Refund Advance Account is one such solution.

However, we also offer the Paytm Instant Refunds solution. This solution lets small and mid-sized online businesses issue refunds to their customers within minutes.

This feature is for businesses that have already integrated or are willing to integrate our payment gateway into their website/app.

Paytm Instant Refunds offers complete transparency on the refund process to merchants who can then share the same with their customers. It provides a refund tracking status that allows customers to monitor their refunds.

Paytm also gives detailed information about refunds to merchants via the Refund Status API. The Instant Refunds solution eliminates this need for tracking altogether by crediting money immediately into customer accounts.

When you combine this solution with the Paytm Refund Advance Account, you can seamlessly process refunds to your customers from a platform. You can process customer refunds even when you do not have enough forward transactional funds.

All you need to do is open and pre-fund the Paytm Refund Advance Account. You can also enable timely notifications, which will tell you to add funds when your account reaches a pre-specified threshold.

It will help you enhance the customer experience with your brand. Also, you will get to enjoy the uninterrupted services of the payment gateway while ensuring timely settlement of chargebacks with the banks.

On a concluding note

Offering facilities like refunds and chargebacks to your customers is a good thing. Using these functionalities to differentiate your business from the competitors will win you more customers in this competitive world.

Your business needs a payment gateway that fits your business model like a glove and fulfills customer needs.

Paytm Payment Gateway is known for offering tailored solutions, and Paytm Refund Advance Account is one of the solutions that prove this testament right.

Are you too looking for a tailor-made payment gateway for your business?

Learn More about Paytm Payment Gateway

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