Articles on: Cancellations and returns

Offer store credit instead of a refund

A refund takes the money out of your business. Store credit keeps it. Turn it on under Features → Returns and exchanges → Setup, in Resolution options. Add a bonus percentage and most customers pick credit willingly — a 10% bonus costs you a tenth of the credit, where a refund costs the whole sale.

Why this matters

Refund to original payment — The whole sale. The money leaves.
Store credit — Nothing today. They spend it with you.
Store credit + bonus — The bonus only — a tenth of the credit at 10%
Exchange — Nothing. You keep the sale entirely.

A 10% bonus on a $50 return costs you $5. A refund costs you $50.

Turn it on

Go to Features → Returns and exchanges → Setup.
Scroll to Resolution options.
Turn on Store credit.
Turn on Store credit + bonus and set a Bonus percentage. Start at 10.
Save.

Customers now see a +10% bonus badge beside store credit when choosing.

Put credit first

Turn on Show credit first and store credit appears at the top of the list, marked as recommended.

A small change that shifts the default. People take the first reasonable option offered.

Let them spend it immediately

Show products to spend the credit on is the strongest setting here.

Turn it on and a customer who chooses credit is shown products in their price range straight away. One tap puts their credit, plus any bonus, toward a new order — they pay only the difference.

This turns a return into a second sale in the same session, while they are still thinking about your products.

The price range

Set how far above the credit value to show products. A wider range gives customers more to choose from, and they often spend more than their credit is worth.

Good to know

The bonus is what convinces people. Customers take credit because it is more money, not because you asked. Without a bonus, most choose the refund.

Store credit is not a gift card. Credit attaches to the customer's account and applies at checkout. A gift card is a transferable code. Credit is the better nudge, because it only works for that customer, in your store.

Do not refund again in Shopify. After Account Editor issues credit, Shopify still shows its own "refund owed" banner — it does not know the customer was paid. Read the order note first.

Keep the bonus below your margin. A bonus larger than your margin turns a retained sale into a loss.

Troubleshooting

Customers never choose credit — Why: No bonus set, or refund is listed first — Fix: Add a bonus, and turn on Show credit first
The bonus badge does not show — Why: Store credit + bonus is off — Fix: Turn it on and set a percentage
No products appear to spend it on — Why: Show products to spend the credit on is off — Fix: Turn it on and set a price range
Few products are shown — Why: The price range is too narrow — Fix: Widen it
Shopify says a refund is owed — Why: It does not know credit was issued — Fix: Read the order note. Do not pay twice.
The credit was not applied at checkout — Why: It attaches to the customer's account — Fix: Check they are signed in

FAQ

What bonus should I offer?

Start at 10%. It is enough to shift most decisions and stays well inside a typical margin. Raise it only if customers still choose refunds.

Can I offer only store credit?

Yes — turn off Refund to original payment. Check your local consumer law first; some countries require a refund for faulty goods whatever your policy.

What is the difference between store credit and a gift card?

Credit attaches to the customer's account and applies automatically. A gift card is a transferable code. Credit is the stronger retention tool.

Does the bonus apply to exchanges too?

The bonus is for store credit. An exchange already keeps the whole sale, so it does not need one.

Will customers feel pushed?

Not if the bonus is real. You are offering more money for taking credit, and they are free to decline.

Updated on: 21/08/2026

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