Credit Card Refunds

To credit your customer's credit card, you simply authorize a transaction with a negative Charge Amount.

NOTE: If you authorize a transaction and it hasn't settled yet, you should cancel the transaction before it settles through Accounting > Settle Credit Card Payments.  If it is still possible to cancel the authorized transaction, it is cheaper to cancel the authorization than to settle the authorization and then issue a separate refund transaction.

When you authorize a refund transaction, the processor does not verify the credit card information.  In reality, refunds require no authorization because it doesn't matter whether funds are available on the card.  Consequently, a potential pitfall exists where you could enter invalid credit card information and the posting would succeed.  Refunds aren't really processed until you try to settle them.  If a refund transaction is posted with invalid credit card information, settlement will fail for all transactions in the batch.  You should be aware of this potential problem occurring and be extra careful to enter the correct credit card information when you post refund transactions.  In the event that a settlement fails, you might try to cancel refund transactions in order to settle any other regular transactions in the batch.

Another thing to keep in mind is that according to the major credit card issuers, you are not supposed to refund a card that you did not charge in the first place.  Although this is a rule that you should follow, there is nothing in the credit card processing interface to prevent you from issuing a credit to a card that you never charged.