How NPCI Handles UPI Complaints: Behind the Scenes

The rise of UPI (Unified Payments Interface) has revolutionized digital payments in India. While the system is designed to be fast, secure, and user-friendly, failed transactions and disputes can still occur. That’s where NPCI’s UPI grievance redressal process comes in.

Have you ever wondered how NPCI handles UPI complaints, what goes on behind the scenes, and how issues are escalated and resolved? This blog provides an inside look at the NPCI UPI complaint process and the structured steps involved in addressing user concerns.

What Is NPCI and Why Is It Involved in UPI Complaints?

NPCI (National Payments Corporation of India) is the organization that operates and manages UPI infrastructure. As the central authority behind UPI, NPCI oversees:

• Payment processing between banks and apps
• Standardized UPI complaint handling
• Technical dispute investigations
• Final escalation for unresolved complaints

NPCI UPI Complaint Process: Step-by-Step

Here’s how NPCI handles a UPI complaint from initiation to resolution:

Step 1: Complaint Raised by User

The user raises a complaint on:

• UPI app (TPAP) like Paytm
• Their bank’s UPI interface (PSP bank)
• Directly on NPCI’s UPI Dispute Redressal portal

The user receives a Complaint Reference Number (CRN) for tracking.

Step 2: App-Level (TPAP) Review

The complaint first goes to the Third Party App Provider (TPAP) that initiated the transaction. The TPAP has a set window (usually 3–5 days) to investigate and resolve the issue.

Step 3: Escalation to PSP Bank

If the issue remains unresolved, the complaint is automatically escalated to the Payment Service Provider (PSP) bank—the bank that hosts the TPAP 

Step 4: Involvement of Remitter/Beneficiary Bank

If necessary, NPCI involves the remitter’s and beneficiary’s banks to cross-verify:

• Transaction logs
• System timestamps
• Error codes
• Internal settlement reports

Step 5: NPCI Arbitration & Resolution

If the dispute remains unresolved or is complex (e.g., fraud, double debit, merchant dispute), NPCI directly investigates by:

• Reviewing technical logs
• Auditing interbank messages
• Confirming compliance
  NPCI may instruct the bank to reverse the transaction or initiate a refund depending on evidence.

Step 6: Final Update & Closure

Once resolved, the user receives:

• Complaint status (resolved, refunded, closed)
• In-app or email notification
• Refund (if applicable) directly to their bank account

If not satisfied, users can escalate to:

• The Banking Ombudsman
• Digital Ombudsman for UPI-related issues

Types of Complaints NPCI Handles

NPCI manages both transaction-related and non-transaction-related UPI complaints, including:

• Amount debited but not credited
• Transaction failure due to technical issues
• UPI fraud or incorrect transfers
• UPI registration, login, or PIN setup failures
• Merchant-related disputes on UPI

How Does NPCI Investigate UPI Complaints?

Behind the scenes, NPCI uses a combination of automated systems and manual audits:

• Transaction trail audits
• Time-stamped UPI message logs
• Bank server communications (Request & Response)
• Error code mapping (e.g., U69: Declined by bank, U15: Invalid VPA)
• Settlement reconciliation reports

NPCI ensures compliance with RBI guidelines and follows a time-bound resolution mechanism for user protection.

Timeline for Resolution