@mgarland : I just checked our account, and PayPal was refunding fees to us on customer refunds right up to October 10th, 2019. Then on October 11th we did a refund an no fee was returned to us–and it has been that way ever since. Really sucks. Guess I did not realize how much money we have been loosing (about $20 per for our typical product).
You can at least avoid the fee on orders that haven’t gone out, by doing manual capture. The fee will not be taken if you cancel before it has been captured. But for actual returns where you’ve taken the money, there’s nothing that can be done really. What I love are the people who are defending this and saying… 'Well, you just have to explain to customers and then take the fee from them’. Think the people saying that would be fine with somebody not returning all their money on a return or cancel? I just think it’s ridiculous that multi billion dollar banks and processors act like they just can’t possibly take the hit for this… but people just making a living should be able to. I’m lucky that I don’t have a lot of returns, but it’s the principle. Plus, just one thing after another with this stuff. They brag about how they don’t charge an extra fee on returns like some orgs do. But watch, that will be next. Then you also have to factor in the insane chargeback issues, where banks basically just help card holders steal stuff. On and on.
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Actually, this is a change from stripe that Shopify is passing through. I work with stripe directly and they sent an email that says any refunds going forward, will not receive the 3 % processing fee refunded.
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We offer tours of our animal sanctuary. We were having an unreasonable # of “no shows” so began requiring people to pay in advance and the largest % of our Shopify transactions are for visitors to pre-pay their tour reservations. We do occasionally have to cancel tours (our decision: weather, animal emergency) but we also have people pre-pay before checking that we have a tour they can join (their fault because they don’t read the instructions) and they also must be refunded.
However, IF, as Shopify claims, they need to “keep” the transactions fees to cover THEIR cost, then why would it not be a FIXED charge, since it is the SAME amount of work to issue a refund regardless of the amount? As others have pointed out, Shopify is not incurring any actual expense from their credit gateway but are justifying the charge to “cover the cost of issuing the refund” (despite the fact that I am certain it is completely automated). Regardless, whether the charge is $50 or $5,000, the “work” is exactly the same so why should the “charge” be based on a % of the transaction cost? If they feel they still need to make money on these transactions (above the subscriptions fees we already pay and the transaction charges), it should be a FIXED amount, or perhaps a tiered-amount. (like $1 for charge <$100, $5 for charges <$1,000, etc.) There is absolutely no reason that a merchant selling high-priced items should be “penalized” for that by charging a % of the total amount refunded.
I recently had PayPal make an error on THEIR end and then try to charge us the transaction fees when it was reversed and I contacted customer support and was able to get the fees refunded. My argument was that I did not ask for or initiate the payment, (which we did not- it was made when FOUR of PayPal’s customers claimed they were “hacked”) why should I be held liable? I also pointed out that if “they” are not responsible when “their system” is hacked, then that means that I have liability for an “unlimited” amount of money. What if we received an unsolicited $10,000 donation, but then someone claimed they were hacked and ask for a refund? Why should we be liable for that? If fact, there would be NO WAY for us to protect ourselves from such a risk. I temporarily removed PayPal as a payment option in our store. Granted, we generate minimal amounts of fees for PayPal (so our leaving would hardly be a big loss) but they still agreed with my logic and refunded the fees (which were over $500 because it included currency exchange fees WAY above market rate!).
Perhaps we can’t convince Shopify to allow no-penalty refunds but the amount should be nominal, not obscene.
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So this is my first store and I did all the testing in test mode for the purchasing of products and running credit cards through.
However, I wanted to actually do it under real circumstances. So I went to my store and placed an order, purchased the product with my own personal credit card. I saw that everything went through. I then placed a refund.
And low and behold I see that I get charged for a transaction fee. This is my first store and it hasnt earned anything yet. And Im getting charged a fee for a refund?!?!?!
So now every time I refund an order, doing the right thing for my customers, I get charged.
Shopify - wheres the customer service for your customers on this one? Why arent you guys doing the right thing for your customers? Customers being myself and all the others that posted here on this forum.
Please contact me on what you are doing to rectify this absurd issue.
With the pandemic happening right now, you would think that Shopify would temporarily waive the return fees - guess not. I’m fine with them keeping the $.30 transaction fee, but that’s it. It’s rich how they write blog articles about how online stores should have a flexible return policy, and then they do this.
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Very good point!
I had just emailed customer support and they respond with - heres the terms
and conditions, and then said “please understand.” And then said that was
all they could do.
Thats not all they can do, they can do a lot more.
How about forwarding this to management? How about providing different
solutions? Like making the fee a flat very small fee, how about reducing
the percentage. How about waiving the fee altogether?!! And do the right
thing! How about realizing we are your customers providing Shopify’s
income which is already a multi billion dollar company BEFORE this
transaction fee on refunds was even implemented? How about looking at this
from our point of view? How about how would “you” (Shopify) feel if we
nickeled and dimed you for every little thing?
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They couldn’t care less, because their business model is built on failure now, not success. They don’t need businesses to succeed. They make more money by having a constant flow of failures, who pay for a year or so, give up, then get replaced by three more. Same with the banks. Why do you think the whole system turns a blind eye to blatantly fraudulent chargebacks? Because the card holders are in debt to them and keep paying them. They make billions from them.
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I’m jumping in here to agree that this is not acceptable policy!
Especially at this time - Covid-19 health crisis with so many cancellations and refunds that are beyond our control. We are a small nonprofit and are loosing a lot of funds through all sources, and now this!! We were contacted by one of our supporters about this situation and he said this is very against best practice in the overall field of credit processing.
NOT COOL, SHOPIFY! At least for the current national emergency, you should reinstate the previous policy and return the processing fee for refunds.
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We changed to Authorize.net and BAMS for the processor. They DO give the merchant back the processing fees. I highly recommend changing ASAP. My rep there is Ashley, and she was available personally 24/7 through the process, and got us changed over before the deadline. Ashleym@bams.com if anyone is interested.
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They sent out an email today saying they’re… "committing over 200 million dollars to help our merchants this year.”’
I don’t know what that means. But yeah, they can keep the 200 million and just remove this fee thing. I’d be fine with that. If Stripe (the guys doing Shopify Payments) are the ones forcing this, then they should threaten to leave them and get somebody else. I mean, this is Shopify… They’re huge. Throw some weight around.
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So from my initial post I was given the canned line from Shopify support, I then cited the exact places in Shopify’s TOS for payments where it directly contradicted their “interpretation” where it refers directly to net fees, indicating that fees are returned from customer returns, and I addressed the section they quoted as justification. That section only addresses fee forfeiture in relation to bank or customer initiated chargebacks, and does not refer to returns. They are in fact violating their own TOS by doing this.
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I went a little post happy on social media about this issue and have been contacted by Shopify support. They are listening to me, but dragging me around without actually saying anything. I was asked to submit a formal support ticket and told “I do not have more information at this point, but if you send me the ticket number I will be able to follow up with you by email once I know more.”
I’ll post here when I find out more! IF!
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I just had my instance of this. Contacted them and got the same results. I am one more person trying to help the cause at least. I told them how we try to prevent theft by refunding fraudulent orders, just to turn around and be robbed by Shopify. I suggested a flat fee would be more fair.
They suggested switching to manual payment capture, I did that for now. Does anyone know of any precautions I should take while using the “manual” setting? or is it just as easy as I stay on top and accept payment promptly?
Any advice appreciated!
Thanks
I was told that even if I haven’t “captured” the order (if it’s just
authorized) I still will be charged the fee if I cancel the order.
If this information I was given was incorrect, that would be a good thing
because then we could simply manually capture the orders before shipping.
I had one customer keep ordering over and over again because I kept
cancelling his order! Ugh
So, now we have conflicting information.
Has anyone experienced issuing a refund before payment capture? Was there a fee or not?
Wow, that is awful. If I experience this instance I will update on here and let you know.
There is no way you would be charged a refund fee before capturing. And if
that were somehow the case, i’d just take non-captured orders and let them
sit in limbo forever.
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Good point.
Hi, may I ask whether you’re using Shopify payments? I operate out of India where Shopify Payments is not applicable and I didn’t get this email.
Problem with this (that they might not have warned you on) is you now pay an additional 2% to Shopify for every single transaction on top of whatever Authorize charges. They tax you no matter what you do now.
I hate to say it but this won’t be the first “subtle” step in this direction. Little-by-little
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