Transaction Credits on Refunds Fees - After March 1, 2020, Shopify will no longer return this fee?!

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New Member
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I just realized this as well! What is the point of Charging a fee receiving an order and now charging a fee when refunding. That’s not helpful to any of our businesses. I must say I’m very disappointed.
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Tourist
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This is completely Shocking! 

 

I got an order and within less than an hour I got an email from the customer saying they needed to cancel the order because it was a mistake. For that Shopify charged me. It is very worrying to know that your website is open for anyone to order something, cancel within minutes and for this you lose money. 

 

Open Business for Losing money  :0 

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Tourist
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That is CRAZY!!!! feel super disappointed about this. 


@Superdad wrote:

I just got off the phone with a Shopify rep.  I sure gave her an earful.  She said she would pass this along to management. This new policy regarding refunds will cost me several thousand dollars per year.

I would move to another CC payment provider, but then Shopify charges 2% on every PayPal purchase.  So they got me either way.

 

The crazy thing is, Stripe is the CC merchant processor that Shopify works through (its right there at the top of the Terms of Service page), yet Stripe does not have this crazy new keep-the-fee policy for refunds.

 

I do not think posting here in the forum is going to be enough. I think a lot of people should call Shopify Support and voice their displeasure with the policy. That stands a (small) chance of getting them to reconsider.



 

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Shopify Partner
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@charovetchy wrote:

That is CRAZY!!!! feel super disappointed about this. 


@Superdad wrote:

I just got off the phone with a Shopify rep.  I sure gave her an earful.  She said she would pass this along to management. This new policy regarding refunds will cost me several thousand dollars per year.

I would move to another CC payment provider, but then Shopify charges 2% on every PayPal purchase.  So they got me either way.

 

The crazy thing is, Stripe is the CC merchant processor that Shopify works through (its right there at the top of the Terms of Service page), yet Stripe does not have this crazy new keep-the-fee policy for refunds.

 

I do not think posting here in the forum is going to be enough. I think a lot of people should call Shopify Support and voice their displeasure with the policy. That stands a (small) chance of getting them to reconsider.



 


I think the only way to combat this is through social media and having it go viral.  I still cant believe there are very few of us complaining about this when there are thousands upon thousands of Shopify stores that all should at least have encountered this despicable issue.

 

Having mentioned social media and going viral - since Im new to this who new thing with Shopify and getting traffic, etc... I really am not sure how I (or we) could get something to go viral.

 

I cant believe with this even being posted here on their very own website, that no moderator or admin from shopify has even responded to this, and acted upon it to look into finding a solution.

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New Member
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Stripe recently announced that they are keeping the 2.9 percent charge on refunds. Paypal also announced they are doing the same last year. So I think Shopify is doing this because of stripe.
You can find the announcement on the stripe website
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Excursionist
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Shopify's Gross Payments Volume (the amount of Gross Merchandise Volume processed through Shopify Payments) grew to $25.7 billion in fiscal 2019 - see:

https://investors.shopify.com/Investor-News-Details/2020/Shopify-Announces-Fourth-Quarter-and-Full-Y...

 

When you're that big, you can push back on Stripe/etc. and defend your million+ merchants... who in the end are why Shopify exists at all.

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Tourist
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I ended up switching to manual payment capture to play it safe.  I have not had to deal with any refunds since to see if there is somehow any charge involved still though.  

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Tourist
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So I wanted to give and update of my experience. I got the canned lined at first from a guru about how they had basically been doing us all a favor this whole time and they cited a section of the TOS, this was my response (to which I NEVER got an answer back),

 

First thank you for the quick response. I understand that our return rate was only 3.5% last year, however at our scale this is $1500-$2000 a year in lost money. The force multiplier for this is that the money we are losing is not gross profit but net profit at the end of the day. In reality this is like losing $5000 in sales for the year as it is money we have already worked hard to make. This is also a matter of principle.
     The section of the TOS quoted as being the rationale for this fee is expressly referring to liability. The section overview sentence specifies this is referring to: “ Reversals, Chargebacks, Claims, fines, fees, penalties and other liability arising out of or relating to your breach of this Agreement, and/or your use of the Service. ” 
By the section’s own description the forfeiture of paid fees Only relates to Reversals, Chargebacks, and other liabilities if I had breached the TOS. Under the definitions in the TOS Chargebacks and other are described as “  "Chargeback" means a request that a buyer customer files directly with his or her card company or card issuing bank to invalidate a processed payment. "Claim" means a challenge to a payment that you or a buyer customer files directly with Shopify. "Reversal" means Shopify reverses the settlement of funds from a processed card transaction that you received because (a) the card transaction is invalidated by the card issuer, (b) the settlement funds were sent to you in error by (i) Shopify, Stripe or Wells Fargo; (ii) the processors, suppliers or licensors of Shopify, Stripe or Wells Fargo; or (iii) any of the respective affiliates, agents, directors and employees of any of the entities listed in (i) or (ii) above, (c) the sender of the payment did not have authorization to send the payment (for example: the buyer used a card that did not belong to the buyer), (d) you received the payment for activities that violated this Agreement or any other Shopify or Stripe agreement, or (e) we decided a Claim against you.” 
     These are the situations described where I would be responsible for the fees. A normal refund is described under none of these situations. This is not in the material spirit of the TOS as under C.3 there is a direct reference to “net fees” - “ Once your bank account information has been reviewed, Stripe, on behalf of Shopify, will initiate transfer of settlement funds (net Fees, chargebacks, and other funds owed to us for any reason) in accordance with the Payout Schedule, the terms of which will be made available to you when you login to our website using your Service Account. ”
      With the language of net fees it makes it clear that return fees are to be returned. This entire interpretation feels like a money grab dreamt up by a lawyer and an accountant to make more money without additional growth. We are already paying over $40,000 a year in transaction fees to Shopify; you don’t need to nickel and dime us more. I worked on Union contracts for over 6 years in a previous career and I would describe this newfound understanding of the TOS dubious at best and what the SEC would describe as predatory at worst. I have been working with one of our retail friends who were looking to switch to Shopify and would have represented over $100,000 in revenue to you through fees and processing. One of the things I said in support of Shopify was that you didn’t nickel and dime your customers. I’m afraid I can no longer make that recommendation and will tell them to consider other platforms as I am unhappy with the direction this indicated Shopify is heading.
 
-Tyler
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Tourist
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thanks for sharing this is very useful information! 

 

Cannot believe the big retailers are gonna ride with this, specially in the current retail climate where most businesses are going to suffer. 

 

Just spoke to my friends who have a massive catalog and sell high volumes thus get a high return/cancellation rate. It's a pain for them to move the store but they are looking at options now :0  

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New Member
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I'm jumping in here to say I found out about this no fee return on refunds just yesterday via a transaction and I am PISSED.

 

I had a potential scammer contact me for a $320 order. She claimed she paid and sent screenshots of a bank transfer and tried to say Shopify Payments had an issue. I even backed Shopify Payments saying I've never had a problem with them. A couple days later, she actually DID pay via Shopify Payments and the order went through. However, she then messaged me to say that it was a "double" payment, and for me to refund the "extra" $320 when the money came in. At this point I decided not to move forward with the transaction and told her I would cancel the order and do a full refund, which I did. Then a Shopify email comes in telling me I'm getting charged $10 for the refund! Talk about adding insult to injury! 

 

I've disabled Shopify Payments and am looking to move off Shopify now. It's been a good run with Shopify, but all good things must come to an end.

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