GST's New 90% Provisional Refund: How It Works for E-commerce Sellers

Every seller who's filed for a GST refund knows the wait. You export a shipment, file your claim, and then watch working capital sit locked up for weeks — sometimes months — while an officer works through the backlog. For a small business, that gap can mean delayed inventory restocking or a missed growth window.

CBIC has been chipping away at this problem, and the latest fix is a genuinely useful one: a risk-based system that can sanction 90% of your refund provisionally, in days, without waiting for full scrutiny.

Where This Comes From

The 56th GST Council meeting (3 September 2025) recommended amending Rule 91(2) of the CGST Rules to allow provisional sanction of 90% of a refund claim based on system-driven risk identification. CBIC formalised this with Instruction No. 06/2025-GST, dated 3 October 2025.

The mechanics: once your refund application is acknowledged in FORM GST RFD-02, the system runs a risk assessment. If your claim is flagged low-risk, the officer doesn't need to complete detailed scrutiny before releasing 90% of the claimed amount. The remaining 10% follows after final verification.

There's a safety valve built in too — the proper officer can still choose, for reasons recorded in writing, to skip the provisional route and go straight to full examination on a case-by-case basis, even for a claim the system marks low-risk. So "low-risk" doesn't mean automatic; it means eligible for fast-tracking.

Why "Low-Risk" Matters More Than the Refund Amount

This is the part sellers underestimate. The system isn't assessing whether your refund claim is valid — it's assessing whether you, as a taxpayer, are a predictable, low-risk filer.

That assessment leans heavily on your compliance history:

• Consistency of GSTR-1 and GSTR-3B filing. Regular, on-time filing over a sustained period (in practice, roughly 12 months of clean history matters) builds the track record the risk engine looks for.
• No unexplained gaps. A pattern of late filings, especially several consecutive months missed, works against you.
• Match between reported and actual data. Large mismatches between your GSTR-1 outward supplies and your refund claim basis invite closer scrutiny by design.

In other words, the sellers who benefit most from this scheme are the ones who've already been doing the boring, unglamorous work of filing cleanly every month. If your filings have been inconsistent, the first fix isn't chasing the provisional refund — it's fixing your filing discipline for a few cycles first.

Who This Helps Most

• Exporters and SEZ suppliers claiming refund of unutilised input tax credit — this is the refund category where the provisional mechanism has been most consistently applied.
• E-commerce sellers with an export component — increasingly common as Indian D2C brands sell cross-border through platforms and their own websites.
• Any seller sitting on genuine excess ITC where the traditional 60–90 day wait has been a recurring cash-flow drag.

Worth noting: the government has also removed the old ₹1,000 minimum threshold for IGST-paid export refund claims in recent changes, so even small claims that used to fall below the processing cutoff are now eligible to be filed and processed.

What to Do Before You File

1. Check your last 12 months of GSTR-1/GSTR-3B filing history. Fix any pending returns before filing a fresh refund claim — an open compliance gap undermines your risk profile right when it matters most.
2. Reconcile your claim basis carefully. Make sure the export invoices, shipping bills, and bank realisation certificates you're relying on tie out cleanly to what you've already reported in your returns. Mismatches are exactly what risk engines are built to catch.
3. File promptly and completely. Incomplete applications don't get to the risk-assessment stage — they bounce back for correction, which defeats the purpose of a fast-track mechanism.
4. Don't assume every claim qualifies. If your refund category isn't covered by the provisional mechanism, or the officer exercises the case-by-case discretion to skip it, budget for the standard timeline instead.

The Bigger Picture

This sits alongside a broader set of GST 2.0-era changes aimed at freeing up working capital for small businesses and exporters — faster registration under Rule 14A, rationalised rate slabs, and now faster refunds for clean filers. Individually, none of these fixes a cash-flow crisis. Together, they reward the sellers who keep their compliance boring and predictable — and that consistency is now paying off faster than it used to.

If you've been sitting on TCS credits from Amazon or Flipkart that you haven't reconciled yet, that's a related and often bigger opportunity — see our guide on claiming TCS refund on Amazon and Flipkart sales.

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Related: How to claim TCS refund on Amazon and Flipkart sales · Simplified GST registration for e-commerce sellers · GST return filing service