Refund a Credit

On This Page

• When to Use This
• What Can Stop the Refund
• Side Effects
• Related Reading

A credit is money a customer has on account with your organization. Sometimes you need to return that money instead of saving it for a future purchase, such as when the customer decides not to replace an item after all. Refunding a credit sends the money back to the card or bank account used for the original payment.

When to Use This

Use this when a customer has a credit and wants the money back instead of using it later. You can only refund credits that came from a payment. If you need to create the credit from a payment first, see Issue a Credit from a Payment.

You can also use this to clear a mistaken account credit left by a payment error, or by a reversal that was handled as store credit instead of a direct refund. Refunding that credit returns the money and reduces or removes the credit from the account. In some situations, applying the mistaken credit to the customer's balance has also been used to clear it, so confirm which approach fits what you need before you choose. After part of a payment has been issued as a credit, the payment's own refund option may no longer be available for that amount; in that case, refund the credit itself.

Prerequisites

• The credit must have money available. You cannot refund a credit that has already been fully used or fully refunded.
• The credit must not be a manual credit. Manual credits do not have a payment behind them, so there is nowhere to return the money, and Rhythm hides the refund option.
• If the credit came from an overpayment on a payment, you cannot refund it directly from the credit. Refund the overpayment from the original payment instead, as described in the warning below.

1. Open the credit's record. You can reach it from the payment, invoice, or credit link on a related transaction, or from the customer's account page.
2. Select Issue Refund. This button appears when the credit has money available and is not a manual credit.
3. In the dialog, choose the Batch: for the refund, or leave it blank so Rhythm can choose an open batch for you.
4. Enter the Amount to Refund:. Rhythm fills in the credit's full available amount, and the amount cannot be less than 0.10 or more than the amount left on the credit.
5. If you do not want Rhythm to send the money through your payment processor, check Do not perform electronic refund. Use this when you plan to return the money another way. A red warning banner appears to remind you that the electronic refund will not happen.
6. Select Issue Refund.

Tip

When you check Do not perform electronic refund, complete the payout yourself. Process the refund manually in Rhythm Payments, using the original payment's transaction as your reference, then return the money another way. If you are clearing an unused store credit off the books instead of sending money back to the customer, archive the refund's batch afterward so the credit no longer appears in your financial records. When the payment behind the credit ran through a payment gateway instead of being processed inside Rhythm, refund the credit in Rhythm first, then issue the matching refund directly in the gateway so your accounting trail and the processor's records stay aligned.

Result

The credit's used amount increases by the refund amount, and its available amount decreases by the same amount. For a card or electronic-check payment, Rhythm sends the money back to the original card or bank account unless you checked Do not perform electronic refund. Rhythm always returns the money to the same card or bank account used for the original payment; you cannot redirect any part of a refund to a different or updated card from the console. The refund appears on the credit record with its related transactions. To find it later, open the order's Order 360 page, open Related Transactions, open the credit, then open the refund from that credit's own Related Transactions. The refund record also offers a print receipt option. If the original payment ran through a payment processor, you can look up that same transaction in Rhythm Payments to confirm the refund on the processor side. The payment that created the credit does not change; its status and amounts stay the same.

Warning

If the credit came from an overpayment, where a customer paid more than the invoice required, Rhythm refuses the refund from the credit even though the button appears. The error message is telling you to use the refund action on the payment instead. Open the related Payment 360 record and issue the refund against the overpayment line item there. Afterward, the credit shows as used with a zero available balance. See Issue a Credit from a Payment for how the same payment page's Payment Options menu offers refunds and credits side by side.

Because the overpayment credit stays tied to the original card payment, refunding it from the payment updates that same payment's transaction record in your payment gateway. It does not create a separate refund entry the way refunding a standalone credit would. The overpayment credit remains on the customer's account until that refund is recorded in Rhythm, even if the money was already returned outside Rhythm. When that happens, record the refund as non-electronic so the credit clears.

A credit created by applying a retroactive coupon is also treated as an overpayment credit, even though it may not feel like one. The same rule applies: refund it from the original payment, not from the credit.

If the overpayment came from an offline payment that has already been posted and has created accounting entries, do not delete the resulting credit. Issue a non-electronic refund instead, so Rhythm creates the matching reversing entries.

What Can Stop the Refund

• The credit has no payment behind it. Rhythm hides this action for manual credits. If you try to refund a legacy credit imported with no linked payment, Rhythm refuses it for the same "no payment" reason.
• The credit is an overpayment credit. Refund the overpayment line from the original payment instead.
• The refund amount is more than what's left on the credit.
• The credit is voided or imported, or the refund would use a different business unit, currency, or payment than the credit's own. Rhythm does not allow any of these.
• The related payment record is missing. In rare cases, the payment behind a credit cannot be opened because the payment record itself is missing. When that happens, you cannot issue the refund needed to reinstate the credit's balance, and you may need help retrieving or restoring the payment record.
• The credit came from an older payment and needs a manual step. Manual credits can never be refunded, but some older payment-based credits may need Rhythm to attempt an electronic refund through your payment gateway first. If that attempt fails, complete the refund manually outside Rhythm and check Do not perform electronic refund when you record it.
• The credit came from a cancellation fee. A cancellation fee often generates its own invoice and pays it by applying store credit instead of charging a card again, so reversing that store-credit usage does not create a refund event in Rhythm Payments by itself. Whether you can send that store credit back to the original card depends on your payment processor. For a Stripe payment, the refund can go back to the card because it stays linked to the original transaction. For BluePay or Rhythm Payments, the store credit cannot be sent back to the card and stays as credit unless you issue a manual, off-platform refund. To check which case applies, look at the original payment's transaction ID: an ID that begins with pi_ is a Stripe payment and can be refunded back to the card. Refunding a cancellation-fee credit also does not automatically apply a credit memo to the related invoice, so that invoice can still show a balance due for the cancellation fee unless you apply a credit memo as well.
• The credit was created in error and the normal flow isn't available. Recovery sometimes means issuing the refund in Rhythm and then manually refunding the transaction in Rhythm Payments so the records match.
• The credit's payment has already been applied elsewhere. If a credit created from a payment has since been applied to another invoice, partially refunding the original payment or reallocating the remainder may not work cleanly, and issuing a credit memo can fail too. A manual refund for the amount you need to return is usually the more reliable path in this situation.
• Your payment processor can't process the refund. When you refund a credit, you cannot continue and reconcile manually after a processor failure. A processor failure always stops the refund unless you checked Do not perform electronic refund before submitting.

Tip

If a mismatched credit-and-refund sequence leaves an invoice showing an incorrect remaining balance, issuing a manual credit for that remaining amount has been used to clear it and change the member's financial summary from open to paid. See Grant or Change a Manual Credit.

Side Effects

Refunding a credit to zero available does not delete the credit record. It stays on the customer's history with zero available and fully used. Rhythm does not show a confirmation step before it sends the money, so double-check the amount before selecting Issue Refund. After the refund goes to a card or bank account, you cannot pull it back through Rhythm. More broadly, after Rhythm creates a refund or its related credit memo, you cannot alter, reverse, or void either one from the console. If you need to correct one after the fact, make the correction directly in your payment processor and record the matching adjustment in Rhythm.

Related Reading

To create a credit from part of a payment first, see Issue a Credit from a Payment. To review a customer's credits, balances, and payment history together, see Review a Customer's Account.