How do refunds work on credit cards?

When you return a purchase made with a credit card, the merchant initiates a refund that is credited back to your card account. This credit reduces your outstanding balance or appears as a credit balance on your statement if the bill was already paid. In India, credit card refunds typically take 3 to 7 business days to reflect in your account, depending on the bank and merchant policies. Unlike debit card refunds, the money is not sent to your bank account but stays within the credit card limit.