Processing fees being charged on Credit Card refunds

Shopify Discussion
1

A few days ago, within 24 hours of getting an order marked “suspected fraudulent”, I refunded a $900.00 order to a customer. I was unpleasantly surprise to find out that during the refund process Shopify still charged me the $28.30 processing fee. This is a very unfair practice in the part of Shopify. While I understand that Shopify has to pay a processing fee, they do not pay a processing fee for refunded transaction.

2

Hi @alroyal

Thank you for reaching out to our community forums with your feedback around the processing fees for Shopify Payments. I also want to welcome you to our community!

You are correct that Shopify Payments does not return the processing fees accrued for refunds when refunding a customer’s order. This is something that has become standard for all merchants using Shopify Payments as of earlier this year. You can review more information about our policies on returns and refunds in our Help Center and TOS for Shopify Payments in the links below:

The reason that we do not return these fees is that Shopify Payments does incur costs when processing refunds and unlike many other payment gateways, we do not charge additional fees on top of that. I know that it isn’t always ideal to have to pay for those fees when the customer cancels their order or if you choose to not move forward with the order and choose to cancel it for them.

The best solution to avoid this situation is to enable payment authorization capture on your checkout. This way the funds are authorized but not collected until you approve them. This will allow you to review the order and cancel without incurring any fees for doing so. You can learn more about capturing payments here: Shopify Help Center - Capturing Payments.

I want you to know that we do appreciate your feedback on this topic and that it is not going unheard. Your feedback has been shared with the appropriate teams for consideration!

Thank you

-Shay

1 Like
3

What happens to the credit card fees that the CC companies refund?

4

Hi @Libertad

I don’t have insight into the processes and fees accrued by Shopify in these situations or if the fees are refunded to the gateway that processes the order. This would vary by banking institute and card used at that time.

If the terms of Shopify Payments are not suitable for yourself or your business, that is completely alright. You can choose from dozens of different payment gateways for your store.