diff --git a/stream/memory_consumer.go b/stream/memory_consumer.go
index 9e5532eb0..8b6a7f581 100644
--- a/stream/memory_consumer.go
+++ b/stream/memory_consumer.go
@@ -187,44 +187,77 @@ func (c *MemoryConsumer) consume(ctx context.Context) {
 				continue
 			}
 
-			err := func() (err error) {
-				// Ensure that handlers don't cause panic.
-				defer func() {
-					if r := recover(); r != nil {
-						c.pushError(fmt.Errorf("PANIC when processing message '%s' in stream '%s':\n%s",
-							m.id, m.streamID, debug.Stack()))
-					}
-				}()
-
-				return handler.handle(ctx, m.id, m.values)
-			}()
-
-			if err != nil {
-				c.pushError(fmt.Errorf("failed to process message with id '%s' in stream '%s' (retries: %d): %w",
-					m.id, m.streamID, m.retries, err))
-
-				if m.retries >= int64(handler.config.maxRetries) {
-					c.pushError(fmt.Errorf(
-						"discard message with id '%s' from stream '%s' - failed %d retries",
-						m.id, m.streamID, m.retries))
-					continue
-				}
-
-				// increase retry count
-				m.retries++
-
-				// requeue message for a retry (needs to be in a separate go func to avoid deadlock)
-				// IMPORTANT: this won't requeue to broker, only in this consumer's queue!
-				go func() {
-					// TODO: linear/exponential backoff relative to retry count might be good
-					time.Sleep(handler.config.idleTimeout)
-					c.messageQueue <- m
-				}()
-			}
+			c.processMessage(ctx, handler, m)
 		}
 	}
 }
 
+func (c *MemoryConsumer) processMessage(ctx context.Context, handler handler, m memoryMessage) {
+	var handlingErr error
+
+	ctxWithCancel, cancelFn := context.WithCancel(ctx)
+	defer func(err error) {
+		// If the original execution errors out, we rely on the timeout to retry. This is to keep the behaviour same
+		// as the redis consumer.
+		if err == nil {
+			cancelFn()
+		}
+	}(handlingErr)
+
+	// Start a retry goroutine with `idleTimeout` delay
+	go c.retryPostTimeout(ctxWithCancel, handler, m)
+
+	handlingErr = func() (err error) {
+		// Ensure that handlers don't cause panic.
+		defer func() {
+			if r := recover(); r != nil {
+				c.pushError(fmt.Errorf("PANIC when processing message '%s' in stream '%s':\n%s",
+					m.id, m.streamID, debug.Stack()))
+			}
+		}()
+
+		return handler.handle(ctx, m.id, m.values)
+	}()
+
+	if handlingErr != nil {
+		c.pushError(fmt.Errorf("failed to process message with id '%s' in stream '%s' (retries: %d): %w",
+			m.id, m.streamID, m.retries, handlingErr))
+	}
+}
+
+func (c *MemoryConsumer) retryPostTimeout(ctxWithCancel context.Context, handler handler, m memoryMessage) {
+	timer := time.NewTimer(handler.config.idleTimeout)
+	defer timer.Stop()
+	select {
+	case <-timer.C:
+		c.retryMessage(m, handler.config.maxRetries)
+	case <-ctxWithCancel.Done():
+		// Retry canceled if message is processed
+		// Drain the timer channel if it is already stopped
+		if !timer.Stop() {
+			<-timer.C
+		}
+	}
+}
+
+func (c *MemoryConsumer) retryMessage(m memoryMessage, maxRetries int) {
+	if m.retries >= int64(maxRetries) {
+		c.pushError(fmt.Errorf("discard message with id '%s' from stream '%s' - failed %d retries",
+			m.id, m.streamID, m.retries))
+		return
+	}
+
+	// increase retry count
+	m.retries++
+
+	// requeue message for a retry (needs to be in a separate go func to avoid deadlock)
+	// IMPORTANT: this won't requeue to broker, only in this consumer's queue!
+	go func() {
+		// TODO: linear/exponential backoff relative to retry count might be good
+		c.messageQueue <- m
+	}()
+}
+
 func (c *MemoryConsumer) Errors() <-chan error { return c.errorCh }
 func (c *MemoryConsumer) Infos() <-chan string { return c.infoCh }