How to refund order in Magento 2?

Every store works hard trying to make their customers happy. However, sometimes it happens that people want their money back. This is an inevitable step in Magento order processing.

In such cases, people request a refund which in Magento is called Credit Memo.

And in this article, you will find out what is it and how to create it. Besides, you will learn about a solution that will help you to get rid of refunded orders.

What is Credit Memo in Magento 2?

Magento 2 Credit Memo is a document that defines how much money will be returned to the customer. How you create credit memos in Magento 2 generally depends on the payment method used while placing the order.

Based on this there are 2 types of credit memos: Online and Offline.

• Offline Credit Memo means the refund will be saved just in the Magento database and the funds won't be transferred to the bank, therefore no money will be actually returned. It is used in case the offline payment method (e.g. money and check) was used while placing an order.
• Online Credit Memo is filed if your payment method module supports the IP bank communication. In this case, the payment method module contacts the bank, and a certain amount of money is charged from the merchant's account. Pay attention that not every payment method allows you to make an online credit memo.

In this article, you will learn how to create credit memos in both cases. However, before you start, check out Magento 2 payment methods.

Create Credit Memo in Magento 2

1. Navigate to Admin Panel > Sales > Orders and choose the order you are interested in from the Orders grid.

2. Go to the Invoices section of the Order you want to create online credit memo for.

3. Click on the corresponding Invoice and press the Credit Memo button in order to create an online refund.

In order to create a refund you have to fill in two fields: Items to Refund and Order Total.

4. Set if you want Items to be Returned to Stock and their Quantity.

5. Press Update Qty's button.

6. Enter the Refind Shipping, Adjustment Refund, and Fee.

• Refund Shipping — the amount of money to be refunded from the shipping fee. (equals to the full order shipping amount)

• Adjustment Refund — additional refund that doesn't apply to any part of the order and is added to the total amount. (used as a partial refund with a gift card or virtual money)
• Adjustment Fee — the amount subtracted from the total amount. (not subtracted from specific order section like items, tax or shipping)

You can as well choose to send the Email Copy of the Credit Memo and leave some Comments.

7. Press the Refund button once you filled out all of the fields.

Create Offline Credit Memo in Magento 2

1. Navigate to Admin Panel > Sales > Orders and choose the order you are interested in from the Orders grid.

2. Press the Credit Memo button in the Order Information section.

3. Fill in the same options as in the Online Refund (Items to Refund and Order Total) and press the Refund button.

Stores that provide a refund option always seem more reliable and trustworthy. And since Magento allows you to create credit memos, you can easily do that from the admin panel now.

Yet, if you need to refund a few orders at once, you might want to optimize this process. That said, you can learn how to create credit memos in Magento 2 programmatically and cope with your tasks faster. 

But what happens with the orders that have been refunded or canceled?

How to Delete Refunded Orders in Magento?

Magento doesn't allow you to delete orders by default. So they are all stored in the order grid, same as all other information about the order like credit memos, invoices and shipments if any. It is fine if there are now so many of them. If you have plenty of orders, canceled or refunded ones can distract or just be redundant.

So, if you want to know how to delete them, there is a solution — Magento 2 Better Order Grid extension.

It allows you to delete orders in the order grid or on the order detail page, but that's far from all it offers you. Check it out and manage orders much faster!