The machine did not dispense the cash. The app said “transaction failed”. Your account was debited anyway. Most people wait, and most of the time the money does come back — but there is a rule about how long that is allowed to take, and a price the bank pays for exceeding it.
The framework
RBI’s circular of 20 September 2019 harmonised the Turn Around Time for failed transactions across payment systems. It was issued for a specific reason: resolution times varied wildly between banks and between payment rails, and a customer’s remedy depended on which system had failed rather than on any principle.
The framework does two things. It fixes a deadline for reversing a failed transaction, and it fixes compensation — Rs 100 per day of delay beyond that deadline.
The part almost nobody knows
The compensation is payable suo motu — on the bank’s own motion. The framework does not require you to complain, claim, or ask. A bank that misses the deadline is supposed to credit both the failed amount and the accrued compensation without any prompting from the customer at all.
In practice, the reversal usually happens automatically and the question never arises. It is the delayed cases — the ones where a reversal takes weeks and the customer chases it — where the compensation is most often simply never paid, because the customer does not know to look for it.
Checking whether you were paid
If you have had a failed transaction reversed late, the compensation should appear as a separate credit, distinct from the reversal itself. Look for two entries, not one. A single credit equal to the debited amount, arriving well past the deadline, is the reversal without the compensation.
What to do
- Keep the evidence at the moment it happens. A photograph of the ATM screen or the failure message, the transaction reference, the date and time, and the machine’s location or ID. This is the single most useful thing you can do, and it takes ten seconds.
- Raise the dispute with the card-issuing bank — your own bank, not the bank that owns the ATM. Get a complaint reference number.
- Do not close the complaint on receiving only the reversal if it arrived late. Ask specifically whether compensation under the TAT framework has been computed, and for how many days.
- Escalate free of charge to the RBI Ombudsman at cms.rbi.org.in if the bank declines or ignores it. Non-payment of prescribed compensation is squarely within the ombudsman’s remit.
Why this is worth the ten seconds
Individually the sums are small — a few hundred rupees on a typical delayed reversal. The reason to care is what the rule assumes about the relationship: the regulator has already decided that a customer who was inconvenienced by a system failure should not also have to argue for redress. When the compensation does not arrive, the failure is not that you did not ask. It is that you were not supposed to have to.
How to use this page
This page describes rules published by the Reserve Bank of India, IRDAI or NPCI, identified by instrument and date so you can verify them yourself. It is general information about those rules, not advice on your particular dispute, and your bank’s or insurer’s own policy document governs the specifics of your account or policy.
Nobody should charge you to claim what is yours
Every process described here is free and can be started by you directly. No agent, consultant or “recovery service” can obtain an outcome you cannot obtain yourself, and none is required at any stage. Oquilia takes no fee from readers, offers no recovery service, and refers no one to any legal practice or intermediary.
If the rule was not followed
Escalate in order: the entity’s own grievance channel first, then the RBI Ombudsman via cms.rbi.org.in for banks, NBFCs and payment systems, or the Insurance Ombudsman for insurers. Complaints to the ombudsman are free, and you do not need a lawyer to file one.
Source
RBI circular on Harmonisation of Turn Around Time (TAT) and customer compensation for failed transactions using authorised payment systems, dated 20 September 2019