At a glance
The percentage of successful Recharge subscription charges that were subsequently refunded (in full or part) within the period. On Recharge specifically this is dominated by cancellation refunds (a subscriber cancels right after their rebill processes and the merchant refunds them as goodwill) and quality refunds (product defect, wrong item shipped). Healthy subscription brands run 1.5, 4% refund rate; >5% suggests a structural product or expectation problem.
| What it counts | COUNT(charges WHERE refund issued in window) ÷ COUNT(SUCCESS charges in window) × 100. Both partial and full refunds count as “refunded” in the numerator. |
| Currency | Currency-neutral rate. |
| Refund timing | The refund DATE is what bucks into the window, not the original charge date. A 03 Apr 26 refund of a 28 Mar 26 charge counts in this period. |
| Subscription cancellation refund | Counted. The most common Recharge refund type: customer cancels subscription, requests refund of the most recent rebill, merchant honours. |
| Quality refunds | Counted. Product defect, wrong item, late delivery. |
| Promotional refunds | Counted. “First month free” applied retroactively, “we sent the wrong size” make-goods. |
| Goodwill / customer service refunds | Counted. A CS-rep-discretionary refund still flows through /refunds. |
| Time window | 30D vsP default. |
| Alert trigger | >5% absolute, OR +50% relative spike vsP. sentiment_key: refund_rate. |
| Reading hints | Spike often signals a fulfilment problem (delayed shipment cohort), a pricing mistake (campaign promo applied retroactively to all subscribers), or an OOS / quality cohort. |
| Roles | owner, finance, operations |
Calculation
Calculated automatically from your Recharge data. See the At a glance summary above for what the metric tracks and the worked example below for a typical reading.Worked example
“Daily Greens Co”. 30-day window 03 Apr 26 to 02 May 26.| Refund category | Refunds issued | USD value | Notes |
|---|---|---|---|
| Cancellation goodwill | 184 | USD 14,540 | Customers cancelled and asked for last rebill back |
| Product quality / defect | 38 | USD 3,002 | Damaged in transit, missing scoop, wrong flavour |
| Late shipment make-good | 22 | USD 1,738 | 4PL warehouse delay cohort |
| Duplicate charge correction | 8 | USD 632 | Customer-portal swap caused unintended double-bill |
| Promotional retroactive | 28 | USD 2,212 | ”Welcome 20% off” applied retroactively to first rebill |
| Total refunds (this period) | 280 | USD 22,124 |
- 1.36% refund rate is well within healthy for a DTC supplement subscription. Typical healthy band 1.5, 3.5%. Above 5% would indicate a structural product / expectation problem.
- Cancellation goodwill (184 of 280) is the largest cluster. Standard DTC pattern: customers cancel and want the last rebill returned, the merchant honours as a retention gesture. Reducing this requires prevention (cancel-flow with pause / skip / discount offers) rather than refusal.
- Late-shipment make-goods (22) point at the 4PL. If this cluster grows over multiple weeks, the warehouse / carrier is the root cause. Recharge admin’s order-shipment view (or upstream Shopify shipping tracking) confirms.
- Duplicate-charge corrections (8) deserve investigation. Customer-portal plan swaps that double-bill are usually a Recharge configuration bug or a misuse of the swap API. Audit the swap-flow events for the affected customer.
- Promotional retroactive (28) is a process issue. Marketing applied a “welcome 20% off” promo retroactively to first-rebill, and CS issued refunds. Cleaner alternative: structure as next-rebill-discount on the subscription itself, no refund needed.
Sibling cards merchants should reference together
| Card | Why pair it with Refund Rate |
|---|---|
rec_refund_volume | Dollar amount complement. |
rec_chargeback_rate | High refund rate often prevents chargebacks (refunded customers don’t escalate). |
rec_total_volume | The denominator for refund-rate. |
rec_total_transactions | Same. |
Shopify refund_rate | Storefront-wide rate, broader (includes one-time orders). |
Reconciling against the vendor’s own dashboard
Where to look in the Recharge merchant portal: admin.rechargepayments.com. The closest comparable view is Recharge Admin → Charges → Refunded filtered by date. Recharge admin shows the running refund total at the top of the filtered list. Why our number may legitimately differ from the Recharge merchant portal:| Reason | Direction | Why |
|---|---|---|
| Time zone bucketing | Boundary days off | Standard. |
| Refund vs reversal | Slight differences | Recharge admin sometimes treats reversals (Stripe-side, before settlement) separately from refunds (after settlement). We aggregate both as “refund” for this rate. |
| Refund date attribution | Theirs may show on the date of charge | Some Recharge admin tiles attribute the refund to the original charge date; this card uses the refund-issued date. |
| Comparison | Expected relationship | When divergence is legitimate |
|---|---|---|
rec_refund_rate ↔ Shopify refund_rate | Recharge often slightly higher | Subscription customers cancel + refund more than one-time-purchase customers. |
rec_refund_rate ↔ Stripe / Shopify Payments refund rate | Should match closely | Same underlying refund events. |
Known limitations / merchant FAQs
“Why is refund rate lower than I expected for a subscription business?” Most subscription cancellations don’t result in a refund. Customers cancel before the next rebill (no charge, no refund). Refund rate counts only customers who waited until AFTER the rebill, then cancelled and asked for a refund. That’s the more aggressive cohort. “Should I tighten the refund policy to reduce this?” Almost always no. Customers refunded promptly rarely escalate to chargebacks (which carry scheme fees and merchant-side dispute work). High refund rate is often the cheaper outcome compared to dispute volume. “Refund rate spiked, what to check first?” Three usual suspects: (1) shipment cohort delayed (4PL or carrier issue), (2) product quality issue (a bad batch shipped), (3) a marketing campaign creating churn-prone customers (price-sensitive cohort acquired on promo). “Cancellation refunds vs cancellation no-refund, can I split?” This card is rate; the cancellation-with-refund subset is in the Recharge admin Charges → Refunded → group by reason. Recharge tags refunds with reason codes (cancellation, defect, late, goodwill, other). “Promotional refunds, can we structure them differently?” Yes. Instead of issuing a refund after charging, apply the discount to the next rebill via Recharge Promotions. No refund operation, lower processing fees, less customer confusion. “Partial refunds, how are they counted?” Counted as one refund event, regardless of partial / full. The dollar value differs (rec_refund_volume tracks that). For rate, both partial and full count the same.