Eli5: what happens if I buy something on a credit card, pay the balance to zero from a checking account, but then return the item and get refunded? Where does the money go?

Question

Eli5: what happens if I buy something on a credit card, pay the balance to zero from a checking account, but then return the item and get refunded? Where does the money go?

In: Economics

Answer 1

Back to the original method of payment, so in this case, your credit card – which would just give you a “credit” on your credit card for the amount of the refund.

Sometimes, you can ask for it to be refunded to your method of choice, but it’s rare, because it would go against typical “anti-money laundering” processes which have been widely used by businesses for decades.