diff --git a/crates/router/src/connector/payme.rs b/crates/router/src/connector/payme.rs
index 0c4543cd8a2..5873609e372 100644
--- a/crates/router/src/connector/payme.rs
+++ b/crates/router/src/connector/payme.rs
@@ -5,13 +5,13 @@ use std::fmt::Debug;
 use api_models::enums::AuthenticationType;
 use common_utils::{crypto, request::RequestContent};
 use diesel_models::enums;
-use error_stack::{IntoReport, ResultExt};
+use error_stack::{IntoReport, Report, ResultExt};
 use masking::ExposeInterface;
 use transformers as payme;
 
 use crate::{
     configs::settings,
-    connector::{utils as connector_utils, utils::PaymentsPreProcessingData},
+    connector::utils::{self as connector_utils, PaymentsPreProcessingData},
     core::{
         errors::{self, CustomResult},
         payments,
@@ -24,7 +24,7 @@ use crate::{
         api::{self, ConnectorCommon, ConnectorCommonExt},
         domain, ErrorResponse, Response,
     },
-    utils::BytesExt,
+    utils::{handle_json_response_deserialization_failure, BytesExt},
 };
 
 #[derive(Debug, Clone)]
@@ -83,29 +83,37 @@ impl ConnectorCommon for Payme {
         res: Response,
         event_builder: Option<&mut ConnectorEvent>,
     ) -> CustomResult<ErrorResponse, errors::ConnectorError> {
-        let response: payme::PaymeErrorResponse =
-            res.response
-                .parse_struct("PaymeErrorResponse")
-                .change_context(errors::ConnectorError::ResponseDeserializationFailed)?;
-
-        event_builder.map(|i| i.set_error_response_body(&response));
-        router_env::logger::info!(connector_response=?response);
-
-        let status_code = match res.status_code {
-            500..=511 => 200,
-            _ => res.status_code,
-        };
-        Ok(ErrorResponse {
-            status_code,
-            code: response.status_error_code.to_string(),
-            message: response.status_error_details.clone(),
-            reason: Some(format!(
-                "{}, additional info: {}",
-                response.status_error_details, response.status_additional_info
-            )),
-            attempt_status: None,
-            connector_transaction_id: None,
-        })
+        let response: Result<
+            payme::PaymeErrorResponse,
+            Report<common_utils::errors::ParsingError>,
+        > = res.response.parse_struct("PaymeErrorResponse");
+
+        match response {
+            Ok(response_data) => {
+                event_builder.map(|i| i.set_error_response_body(&response_data));
+                router_env::logger::info!(connector_response=?response_data);
+                let status_code = match res.status_code {
+                    500..=511 => 200,
+                    _ => res.status_code,
+                };
+                Ok(ErrorResponse {
+                    status_code,
+                    code: response_data.status_error_code.to_string(),
+                    message: response_data.status_error_details.clone(),
+                    reason: Some(format!(
+                        "{}, additional info: {}",
+                        response_data.status_error_details, response_data.status_additional_info
+                    )),
+                    attempt_status: None,
+                    connector_transaction_id: None,
+                })
+            }
+            Err(error_msg) => {
+                event_builder.map(|event| event.set_error(serde_json::json!({"error": res.response.escape_ascii().to_string(), "status_code": res.status_code})));
+                router_env::logger::error!(deserialization_error =? error_msg);
+                handle_json_response_deserialization_failure(res, "payme".to_owned())
+            }
+        }
     }
 }
 
diff --git a/crates/router/src/core/payments/operations/payment_response.rs b/crates/router/src/core/payments/operations/payment_response.rs
index 099eae71800..33e8ff26edc 100644
--- a/crates/router/src/core/payments/operations/payment_response.rs
+++ b/crates/router/src/core/payments/operations/payment_response.rs
@@ -483,6 +483,13 @@ async fn payment_response_update_tracker<F: Clone, T: types::Capturable>(
                                     200..=299 => storage::enums::AttemptStatus::Failure,
                                     _ => router_data.status,
                                 }
+                            } else if flow_name == "Capture" {
+                                match err.status_code {
+                                    500..=511 => storage::enums::AttemptStatus::Pending,
+                                    // don't update the status for 429 error status
+                                    429 => router_data.status,
+                                    _ => storage::enums::AttemptStatus::Failure,
+                                }
                             } else {
                                 match err.status_code {
                                     500..=511 => storage::enums::AttemptStatus::Pending,