Payment Refund Rate

Date created: Oct 12, 2022  •   Last updated: Oct 12, 2022

What is Payment Refund Rate?

Payment Refund Rate is the percentage of total successful payments that consist of refunded charges in the same period of time. Though similar in outcome, Refunds are different from Chargebacks, which are involuntary refunds initiated from the cardholder's bank, and come with fees.

Payment Refund Rate Formula

ƒ Sum(Refunded Charges Count) / Sum(Charges Count)

How to calculate Payment Refund Rate

Say your customers demand refunds for 10 out of 1,000 payments in one week. Your Payment Refund Rate for this week would be 1%.

Start tracking your data

Use Klipfolio PowerMetrics, our free analytics tool, to monitor your data. Choose one of the following available services to start tracking your instantly.

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How to visualize Payment Refund Rate?

Use a line chart to observe how your Payment Refund Rate trends over time.

Payment Refund Rate visualization example

Payment Refund Rate

Line Chart

Here's an example of how to visualize your Payment Refund Rate data in a line chart over time.
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Payment Refund Rate

Chart

Measuring Payment Refund Rate

More about Payment Refund Rate

Payment Refund Rate measures the ratio of refunds to successful payments, giving you a picture of the overall percentage of your charges that do not result in refunds.

In general, you are not charged additional fees by your payment processing platform for refunded payments. However, it is still desirable to keep this number down. When you grant a refund to your customer, they receive the refund on their original payment method.

Recommended resources related to Payment Refund Rate

Read more about refunds from Stripe.