What is a Return/Refund Policy

A Return and Refund Policy is the agreement where you inform customers about your policies regarding returns and refunds.

It usually includes the following pieces of information:

  1. How many days they have to return a product
  2. How will they receive the refund (credit or replacement)
  3. If you offer refunds for digital products or in-app purchases
  4. Who pays for shipping to return the product
  5. And so on

Why use a Return/Refund Policy

Most e-commerce stores should have a Return or Refund Policy. This includes retail stores as well.

Customers must be informed about their rights to refunds. This “policy” is the page where businesses inform customers about their policy on return and refunds.

The Policy is part of the 3 legal agreements your e-commerce business should have:

  1. The “Return and Refund Policy”. Use this agreement to inform users about your policy on returns and refunds.
  2. The “Privacy Policy” agreement. This is required by law.Use this agreement to inform users about your privacy practices and what kind of personal data you collect from users.

    If you collect any kind of personal data from your users (e.g. email addresses, first and last names), you’re required by law to have this agreement.

  3. The “Terms and Conditions” agreement.This is optional but recommended. Use this agreement to set the rules and guidelines for users when they register an account with you.

    You could add the Return and Refund Policy in your Terms and Conditions rather than having a separate agreement on returns.

Wikipedia defines “returning” as:

In retail, returning is the process of a customer taking previously purchased merchandise back to the retailer, and in turn, receiving a cash refund, exchange for another item (identical or different), or a store credit.

Most countries industry regulations require stores (even digital stores) to have this kind of policy.

eBay’s help pages mention that stores with return policies published online will sell better. However, eBay requires all stores to have this policy:

We’ve found that items with clear return policies typically sell better than items that don’t.

What to include in Return/Refund Policy

Download Return/Refund Policy template. It’s free.

Your Return Policy or Refund Policy should include at least the following sections:

  • The numbers of days a customer can notify you for wanting to return an item after they received it
  • What kind of refund you will give to the customer after the item is returned: another similar product, a store credit, etc.
  • Who will pay for the return shipping

If you sell digital products, the Policy should include the following sections:

  • If you offer refunds on digital purchases
  • If you offer refunds in limited cases, e.g. download link wasn’t working

The best Policy you can have is the simplest one. Here’s what a policy based on the above tips will look like:

If you are not 100% satisfied with your purchase, you can return the product and get a full refund or exchange the product for another one, be it similar or not.

You can return a product for up to 30 days from the date you purchased it.

Any product you return must be in the same condition you received it and in the original packaging. Please keep the receipt.