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This guide will explain in which situations shoppers will be fully or partially refunded to a gift card rather than the payment method on the original order.
General Refund Logic
We have the following basic logic for when refunds are issued back to the payment method on the original order rather than a gift card, but there may be other unique situations where the original order is less than 120 days old (175 for Paypal), and the refund will still default to a gift card.
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If less than 120 calendar days has elapsed between those events, refund issuance will be defaulted to the original order's payment method.
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Where an available option, or as separately defined as the default refund target (based on a merchant's settings), gift card refund issuance will also be feasible.
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If more than 175 calendar days (PayPal) or 120 calendar days (all other gateways) has elapsed between those events, refund issuance will be defaulted to a gift card/store credit.
Scenario 1: Returnly attempts to refund to the payment method on the original order, but the refund fails.
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This is common with payment gateways in which the refund potential is not available on Shopify, but on the payment processors system. This is the case with merchants on Facebook Commerce.
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Normally on a standard RMA, if the refund request sent to Shopify fails, Returnly will transition the RMA to a pending refund status and the merchant will have to issue the refund externally. More information here: Managing an RMA: Pending Refund Status
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On a RoE/RoR RMA, Returnly will not transition to the RMA to a pending refund status, but will instead issue the refund in the form of a gift card.
Scenario 2: Returnly Refunds the shopper back to the payment method on the original order, but a portion of the refund is allocated to a gift card.
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This can happen if there is not enough refund potential on the original order to fully refund the shopper back to their original payment method. This is sometimes due to the fact that they’ve issued a partial refund on the order via Shopify.
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In standard RMAs, Returnly will throw out an error that it Failed to Fully Allocate Funds and would not process the refund unless there’s enough refund potential. This is addressed here: Confirm Already Refunded Screen: Failed to Fully Allocate Funds
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On RoE/RoR RMAs, Returnly will not throw this error, but will refund what it can back toe shopper’s original payment method, and then allocate the rest to a gift card.
Frequently Asked Questions
Q: What happens when my shopper returns an item that was made with Returnly Credit?
A: We call this a Return of Repurchase (RoR) or Return of Exchange (RoE). By defined logic, Returnly will not issue another Returnly Credit nor offer an exchange for such RoR/RoE RMAs.
For refund issuance, there are two possible scenarios, which is explained above.
Why? Payment processors limit the timeframe, after an original order is created/placed, for a refund to be issued against the transaction. In instances as defined above, gift card/store credit issuance ensures that a shopper is still refunded for their RoR/RoE even where additional time has elapsed.
> Related guides:
- In-depth guides on managing canceled or adjusted repurchases and exchanges for normal returns can be found here.
- In-depth guides on managing canceled or adjusted repurchases and exchanges for Shop Collections can be found here.
