Credit Card Refund Not Credited? Timelines and Escalation

"The merchant says the refund was processed last week, but nothing shows on my credit card." In most cases the refund is moving through the card network and lands within a few working days. If it has not appeared 7 working days after the merchant's refund date, get the ARN (acquirer reference number) from the merchant, give it to your card issuer and ask them to trace it; if the issuer does not resolve it in 30 days, go to the RBI Ombudsman.

This guide explains how card refunds travel, the timelines that actually apply as of October 2026, how a refund interacts with your bill, and how to escalate. If the merchant refuses to refund at all, the fix is a chargeback, covered in credit card chargeback vs refund.

Refund, reversal or failed transaction: which one is yours?

RBI's harmonised turnaround time rules (2019) cover only failed transactions, where your card was debited but the merchant never got confirmation. For those, the bank must reverse within T+5 days (T is the transaction date) and pay ₹100 a day for any delay beyond that, without you having to ask. A genuine refund on a successful purchase is different: the merchant decides when to start it, so there is no RBI clock until you complain to your bank.

How a credit card refund travels

1. Merchant initiates the refund in its payment gateway.
2. Acquiring bank (the merchant's bank) sends it to the card network and generates an ARN.
3. Card network (Visa, Mastercard, RuPay, Amex, Diners) routes it to your issuer.
4. Your issuer posts it to your card account as a credit.

A delay can happen at any step, but most often the merchant has only "approved" the refund internally and not yet sent it. That is why the ARN matters: if the merchant cannot give one, the refund has probably not left its system.

Step-by-step fix

Day 0 to 7 after the refund date

1. Check the card statement and the unbilled transactions in the app, not just the "available limit". Search for the merchant name and the amount; the credit may appear under the payment gateway's name.
2. Ask the merchant for the refund date, amount and ARN. Many e-commerce sites show it under the order's refund details.
3. Check for partial refunds. A ₹4,999 refund may arrive as two separate credits if the order had two items.

After 7 working days

4. Raise a complaint with your card issuer through the app, the official website or the number printed on the back of your card. Give the transaction date, original amount, refund amount, merchant name and ARN.
5. Ask for a ticket number and the date by which the issuer will respond.
6. If the merchant has no ARN, go back to the merchant in writing; the refund has not been sent. Use the National Consumer Helpline (1915 or its app) if the merchant stalls.

After 30 days without resolution

7. Write to the issuer's grievance redressal officer, then the principal nodal officer, whose details are on the issuer's website.
8. File with the RBI Integrated Ombudsman at cms.rbi.org.in (helpline 14448). Under the 2026 scheme, in force from 1 July 2026, file within 90 days of the issuer's last reply or its 30-day deadline, whichever is later. See bank not resolving complaint for the full process.
9. If the merchant never sent the refund, ask your issuer to raise a chargeback instead, within the network's time limit.

How a refund affects your bill and interest

RBI's Master Direction on credit and debit cards (2022) and its FAQs settle what happens when the refund lands:

• Refund before the bill is generated: it is netted against your other spends in that cycle.
• Refund after the bill but before you pay: it is adjusted against the total amount due; you pay only the balance.
• Refund after you have paid: it becomes a credit balance. The issuer must take your explicit consent to adjust it against future spends, or credit it to your bank account if you ask.
• Interest and late fees are calculated only on the outstanding amount after payments and refunds, not on the full bill.

Worked example (illustrative)

Neha's card bill, generated on 5 October, shows a total due of ₹42,000, payable by 25 October. It includes a ₹12,000 phone she returned. The merchant's refund of ₹12,000 is credited on 18 October.

• Amount Neha now owes: ₹42,000 − ₹12,000 = ₹30,000.
• If she pays ₹30,000 by 25 October, she has cleared the bill in full. No interest, no late fee.
• Suppose instead she pays only the minimum due of ₹2,100 and waits. Interest at, say, 3.5% a month then runs on the unpaid balance. Even a rough lower estimate on the ₹27,900 left over for a month is ₹27,900 × 3.5% = about ₹977, plus GST on interest. The real charge is usually higher, because once you do not pay in full, interest typically runs from each purchase date.
• Suppose the refund had arrived on 28 October, after she had paid ₹42,000 in full. The ₹12,000 shows as a credit balance; she can ask for it to be sent to her bank account or agree to have it adjusted next month.

The lesson: a pending refund is not a reason to skip the payment. Pay the undisputed part on time. You can test different scenarios with our credit card interest calculator.

Special cases

• Card closed or replaced: the refund still posts to the old card account. If the card is closed, ask the issuer in writing to transfer the credit balance to your bank account.
• EMI purchase refunded: the issuer should cancel the EMI plan and reverse interest charged on it; processing fees may or may not be reversed depending on the issuer's terms. Check the next statement.
• International merchant: the refund is converted at the rate on the refund date, so it may be slightly more or less than you paid in rupees. Mark-up fees are not always reversed.
• Double charge rather than a refund: see credit card wrong or double charge.

Sample complaint to the card issuer

Subject: Refund not credited - Card ending [XXXX] - [Merchant] - Rs [amount]

Dear Sir/Madam,

On [date] I paid Rs [amount] to [merchant] with my credit card ending
[XXXX]. The order was [cancelled/returned] and the merchant processed
a refund of Rs [amount] on [date], ARN [number].

As of [today's date], the refund has not been credited to my card
account. Please trace it using the ARN and credit it, and reverse any
interest or late fee charged on this amount.

[If a failed transaction: The payment failed but my card was debited.
Under RBI's TAT circular this should have been reversed within T+5
days; please also pay compensation of Rs 100 per day of delay.]

Attachments: order details, merchant refund confirmation, statement.

Name, registered mobile

What not to do

• Do not skip the bill because a refund is pending; interest and late fees will apply to the unpaid amount.
• Do not call "refund helpline" numbers found on search results or social media. Fake customer care numbers are a common way to steal card details. Use the number on the back of your card or in the official app.
• Do not share your card number, CVV, OTP or PIN with anyone offering to "process your refund"; a genuine refund never needs them.
• Do not install screen-sharing apps at a caller's request.
• Do not wait months. Chargeback windows close; start the complaint once 7 working days pass.

Key takeaways

• Merchant refunds usually reach the card within a few working days to two weeks; RBI's T+5 rule with ₹100 a day applies only to failed transactions.
• The ARN is your proof that the refund was sent; without it, chase the merchant.
• A refund received before you pay is adjusted against the amount due; one received after needs your consent before being adjusted.
• Escalate: issuer, then grievance and nodal officer, then the RBI Ombudsman after 30 days; National Consumer Helpline 1915 for merchants.
• Always pay the undisputed amount on time while the refund is traced.