With the social distancing norm and unpredictable lockdowns, India has already turned to online payments for transactions.


The majority of businesses have opted for online stores and online/digital payments.

With the convenience and easy process, customers are also happy with online payments.

Within the numerous online payment methods, UPI and IMPS are relatively popular among people.

Both of the methods are gaining popularity as they are secure and extremely easy to use.

But amidst all this chaos, people are somewhat forgetting to get to know the basics of how these methods work.

Sometimes while shopping, the transaction won’t go through. sometimes, the screen gets stuck on the ‘payment processing’ screen and at the same time, you get the message saying your account is debited with the said amount.

These are the times, people get confused. And same can be the reason, next time while paying people won’t opt for the same method.

So, while planning with the IMPS or UPI option, keep these things in mind and don’t panic if the transaction did not go through.

What does ‘payout’ actually means?

In simple terms, Payout is the transfer of money made by a business to its vendor.

Once the payout is initiated by the sender, API processes the payment, and the status of the payment is sent to the sender. Once the account of the sender is debited, the payment can either be,

Success – is simple as it sounds, this status states that the said amount is successfully credited to the beneficiary account. The payout is successful.

Reversed – The payout is not processed (due to various reasons, eg. issues at the beneficiary bank, authorization problems, etc.) and the amount is sent back to the sender’s account.


In processing – A case in which, the amount is debited from the sender’s account but the transaction remains uncompleted due to other issues. So, in this case, the beneficiary account does not get credited with the payout amount.

In the case of UPI or IMPS, payout generally lasts for around 180 sec. So, in professional terms, if your transaction is still incomplete after 180 s, it is either deemed successful or deemed approved.

Though online payment done via IMPS or UPI is an on-the-spot payment, the transfer of funds does not take place in real-time. This is due to the settlement schedule between banks.

What is settlement? Here is your settlement guide

If the settlement happens successfully transactions are categorized as a successful transaction and for any failed transaction settlement does not takes place.

Once the funds are credited to the vendor’s account, the respective bank returns a ‘success’ status that in turn returned to the one making transaction making it a ‘processes’ transaction.

On the other hand, if the funds are not credited into the account, it returns a failed status, making it a ‘reversed’ transaction.

But, as for the ‘payment processing’ transaction, the funds get transferred to the bank but not to that account (beneficiary account).

Such transactions are deemed successful transactions. This can happen due to internal issues or technical difficulties like downtime, etc. at the bank.

If the status remains in the ‘deemed success’, the bank and NPCI perform reconciliation to return the final status that can be – processed, failed, or reversed to the associated bank.

Typically and in most cases, settlement takes T+1 or T+2 days to settle the funds.

All in all, if you face the problem where you made an online transaction that debits the funds from your account but the payout takes much longer than the normal amount, fret not, all you have to do is wait patiently for a few days to know the status of your transaction and settlement.

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