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Linked payments and bank denials on refunds

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We've been asked two primary questions about refunds other than the "overpayment balance" message that was covered in the last post.

Those two questions are:

  1. What is a "linked payment"?

  2. Why is my refund request being denied by the bank?

Linked Payments

All refunds sent through OwnerRez must be associated with a previous payment.  When you open the Send Refund form, you'll notice this requirement right away.

linked payments when sending refunds

The form will show all previous credit card payments on the booking and ask you to select one to "link" to the refund you are about to send.

This is required because the banking system (known as "interchange") requires it.  There are some payment gateways that allow you to send unlinked refunds (i.e. a refund of any amount sent to any credit card at any time) but you have to comply with certain rules and undergo a much more rigorous underwriting process.  The vast majority of merchant providers and gateways do not allow unlinked refunds.

To make this process easy for you, OwnerRez records links between payments and refunds and shows you, at the time of refund, the refundable balance left on each payment.

linked payments when sending refunds

When the refundable balance of any payment drops to zero, that payment is no longer available for refunds and will no longer display in the Linked Payment list.

Why Are Some Refunds Denied?

When sending refunds, some OwnerRez users have discovered that the bank doesn't always accept a refund request.  Sometimes, even when everything appears to be in order, you still end up with the cryptic "refund request denied" message.

Unfortunately, the gateways rarely include a reason in their response when a refund request is denied.  We spent some time researching the issue and found that most refund rejections occur for one of the following two reasons:

  1. The length of time between the current refund and when the linked payment was originally made is too long.

  2. The credit card used for the linked payment is no longer valid.  The guest may have cancelled their card between then and now.

The length of time is set by the gateways.  Authorize.Net allows 120 days between the original payment and refund.  PayPal only allows 60 days between the original payment and refund.  Sage Payments and our internal processing allow for 180 days.  If you're trying to send a refund past that many days, it won't work.  You'll have to send the guest a check in the mail.