You can create credits to reduce a customer's current or future account balance as a good will gesture or for other business reasons. If you issue a refund and choose not to void the corresponding invoice or if you missed the refund deadline, you may choose to issue a credit to a customer in the amount of the invoice. This will settle the customer's outstanding balance on the invoice.
There are two types of credits that you may issue:
- Service Credits: A service credit is applied against future invoices and does not affect a customer's current outstanding balance.
- Cash Credits: A cash credit is applied immediately and reduces a customer's current outstanding balance.
Other ways to reduce a customer's balance are through Chargebacks and Refunds. A chargeback is the return of funds to a customer initiated by the issuing bank of the payment method used to make a payment. A refund is the return of money that was previously paid by a customer.
