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There are multiple parties involved in completing an online payment. Payment Gateways like Cashfree communicate with Cashfree’s bank (acquiring bank or bank getting credited) and the payment switch to complete a payment. These entities in turn communicate with card networks and the buyer’s bank (issuing bank or bank getting debited). Read more about how a payment gateway works here.
With multiple stakeholders involved, there might be delays in completing a payment due to delayed response from any of these parties. This will particularly affect businesses that deliver products/services based on the payment end-state.
In order to help businesses deliver their products/services faster and reduce the payment uncertainties, we have introduced Real-time Reconciliation.
What is Real-time Reconciliation?
For many merchants, especially that offer products/services with dynamic pricing, delays in payment confirmation affect the business. With the real-time reconciliation feature, merchants can now get to a definitive terminal state for these transactions within a short, pre-defined period of time so they can decide on whether the product or service must be offered or not.
How does it benefit the merchant?
Let’s take an example of a travel agency that books flight tickets to customers. If there are any delays in the payment confirmation, it might affect the booking as flight ticket rates are highly dynamic and susceptible to change. In such cases, the merchant (the travel agency) should be able to get a payment confirmation within a specified time in order to proceed with the booking.
With real-time reconciliation, merchants can now define a specific SLA and Cashfree makes sure the payment end-state is arrived within the specified time. The SLA could be anytime between 10 minutes to one day. The merchants will also be notified as and when these transactions arrive at the terminal state. This will help merchants a great deal in making sure their products/services are fulfilled without any payment uncertainties.
In short, with real-time reconciliation,
- Merchants get visibility on real-time status of each payment and can provide the service accordingly
- In case of failed transactions, Cashfree returns the money back to the customer automatically, saving the merchant from the hassles of processing refund
- Zero cost refunds. The merchant does not have to pay TDR charges for transactions that are not successful.
One word of caution: While Real-time reconciliation offers a definite terminal state for payments much faster and helps improve customer experience, it can sometimes marginally affect the transaction Success Rates if the recon time is kept very low. Hence merchants that want to optimise for success rates are advised to select their recon time configuration accordingly and allow at least 10 minutes for delayed but successful payment confirmations to reflect.
How does it benefit the customers?
Customers who make a payment and don’t see a successful payment status, do not have visibility on the status of the transaction. In such cases, Cashfree helps customers by providing complete visibility on the transaction status.
For example, let’s say a customer makes a payment at an e-commerce store using their UPI ID. The money has been deducted from the customers bank account, but the order has not been successfully placed at the e-commerce store. The customer, now, does not have clarity if they should go ahead and place a new order, or wait for this payment to show up. This may in turn lead to bad customer experience.
These customers can now have complete visibility of the transaction status (success or failure) within a specified time, and they can decide on the next steps accordingly.
This feature is enabled automatically for all the merchants, and the default reconciliation time will be set as 24 hours. If you wish to change the time frame, please send us an email to email@example.com.
We’d love for you to try this feature out and let us know your feedback.