January 22, 2026 · 5 mins read
Santosh Kumar
When a merchant processes a return on a UPI credit card after issuing an invoice, it is returned to your credit card account rather than your bank account since UPI credit card transactions are deemed to be card transactions. Returns or refunds made in relation to a card transaction will be processed according to the same guidelines as any other type of card return. Typically, the credit for any returned amount will appear in your credit card account two to seven working days following the request by the merchant, depending on the merchant's policies and the policies of your card's issuing institution.
You are not released from the liability of paying for a purchase that was made before receiving a refund. The monthly statement you received includes only those transactions up until the date of your cutoff for billing. If you happen to receive a refund after that cut-off date, it does not change the information in that monthly statement, and you must pay at least the minimum required payment as well as any additional sums to avoid accruing fees and finance charges until you receive notice of the amount that was refunded to you. Refunds will be included in your next month's billing cycle, allowing you to have an accurate account of what you are actually obligated to pay back to your credit card issuer.
Typically, a refund will be reflected on your card statement as a negative amount, or credit entry, which will reduce your unpaid balance for the next cycle. If you have already paid in full for an invoice, your refund will create a negative or surplus balance. Depending on the circumstances, this may be applied toward future purchases, or, if requested, it could be returned to your bank account.
Tracking refunds is extremely important because UPI payments create immediate results. Users are used to this instant gratification and, therefore, will assume that refunds will be processed as quickly as the actual payment itself; however, with credit card refund requests, the card networks will determine how long the process will take, which can cause time delays from requesting a refund to the actual posting of that refund.
Also Read: Documents Required for GST Registration for Different Business Types
Another factor to consider is interest calculations. If the user has not paid an invoice in full, due to the fact that they expect to receive a refund, they may incur interest charges if the refund is delayed past the due date. To remedy this issue, it would be more fiscally sound to pay your outstanding invoices on time and let the credit reflect in the next billing cycle.
If you receive a refund after your statement has already created. It doesn't affect your credit score on it's own. The factor which determines how your credit profile is maintained is whether or not you paid your bill on time. As long as you stay current with your payments, the timing of when you receive your refund will have no negative impact on your credit profile.
Also Read: GST for E-Commerce Sellers: Rules & Compliance Checklist
Due to the fact that UPI credit card use is still fairly new to many users, there is often confusion regarding the refund process. The best way to avoid being uninformed about what a refund is is by routinely checking your card statement along with your transaction history. If you have not received your refund within the time frame that you expect, you should contact your issuing bank or the merchant.
ZETAPP and other platforms are aiming to provide users with a clearer understanding of how credit-based processes work by displaying how each transaction, refund and repayment affects their overall balance.
Also Read: Types of GST Registration in India
No, your bill will not be regenerated because the refund will appear on your next billing cycle.
Yes, you should pay the minimum amount due and ideally the full amount to avoid accruing interest.
It generally takes a couple of business days; however, the time frame can vary based on your bank and the store that processed the refund.
In some cases, you can transfer your refund to your bank account if this results in a credit balance. However, it will depend upon bank policy.
Build and Maintain a 750+ Credit Score
