Can I offer store credit instead of refunds on returned items?

6 0 8

I want to give my customers the option to receive store credit instead of a refund when they return an item. The store credit should go directly into their accounts and act as a store credit. Can this be done? My website requires you to make an account before a purchase so they will all have accounts linked to their email. Does Shopify allow you to do this or would I need to hire a developer? 

Replies 54 (54)

2 0 0

Up until recently, the only option to provide a Shopify store credit was through the use of discount codes. Discount codes are super simple to set up and definitely have their place in the flow of your online store. 

A discount code is like a passkey offered to customers to reduce the price of an order. The customer enters the discount code at checkout and the discount is automatically applied. With Shopify, you can offer fixed value, percentage, or shipping discounts in your store. You can set an expiration date on the code, a minimum order amount, and the number of times the code can be used.

However, when offering store credit on Shopify with discount codes, there are quite a few unappetizing downsides:

  • There’s no way for shoppers to maintain a balance. If you give a shopper $50 off through a discount code but they only want to use $20 today, they lose the remaining balance on their discount code.
  • Basic discount codes can only be used once. After that the code expires and the customer is no longer able to use it.
  • Multiple use discount codes can cause even bigger problems. If you offer a multiple use discount code for $50, the shopper could receive a $50 credit on every order they place. So your $50 store credit could blow up into $500 or more worth of store credit.
  • With discount codes the user has to enter in a typically long random code and there is no stored value, its just a percent or dollar amount off.

What about gift cards? Gift cards are another form of payment that can be used for store credit and redeemed on your store. Once you load the store credit money onto the gift card, the customer will receive an email with a link to redeem it at a time of their choosing. This ensures the customer will return to your store to spend that money, but there are a couple of issues with gift cards:

  • Gift cards are typically only available on Shopify’s Advanced Plan ($79/month). This has been temporarily suspended due to COVID-19, but could go back into place any day.
  • Gift card purchases are counted as revenue even though they’re actually refunds. That could create a nightmare for your accounting.

Gift cards are a better option than discount codes, but they still pose issues that you’ll need to account for. Learn more about how to offer a Shopify store credit

22 0 9

I read this thread about store credits with a lot of interest.  We want to issue either store credit or gift card for refunds that are the customers arbitrary decision to return products vs refunding to the original payment method.   We are an on-line store and thus do not use Shopify POS which I understand offers some kind of store credit functionality, although after reading this thread it does not sound like it is very good option.   I also know that Shopify will only issue refunds to the original payment method.  So it seems to me that we are going to have to develop a workaround process for when we want to issue refund via gift card vs against the original payment method.

My questions is this - does anyone have a good manual work around process for making some refunds to gift cards vs the original payment method?   I have thought of a few but possible ways involving issuing a free gift card in the amount of the refund to the customer but they are very manual and messy and I have no doubt will result in adjusting entries being required in the accounting records.  Any and all suggestions appreciated.

30 0 119

Thank you for your kind response. However, I do not believe anyone is “confused” about the difference between a store credit and a gift card.  🙂

The problem we have with Shopify is our inability to clean up duplicate accounts.  This makes any kind of store credit solution difficult to manage.  The same thing goes with customer loyalty programs. When I have so many valuable customers that have 4-5 accounts in Shopify…it’s a nightmare. 

We all understand the difference between store credit and gift cards. I hope you can understand the core issue with Shopify lacking customer record management. (See my many prior posts on this). Thank you!

2 0 0

My though on a solution for this is to provide a discount for the amount on any item in the store. It seems to handle a "credit". Other than no showing up on their account and them not being able to apply another discount code, is there a reason this shouldn't be used? Something I may not be thinking of? 


Thank you all.

7 0 19

We offer a coupon code in the amount that the credit would be, it can be tailored for the individual customers, usages, items etc..

I agree with the other posters here, that there should have already been a built in mechanism for this as it only makes sense.