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Refund Rate

The share of transactions that end in a refund.

What it is

Refund Rate measures how often completed transactions are refunded, eroding both revenue and the trust your marketplace runs on. Persistent refunds usually trace back to specific sellers, categories, or fulfillment gaps. Track it closely, since refunds also strain payment processing and can draw scrutiny from providers like Stripe when they climb too high.

Formula

Refund Rate = (Number of Refunds ÷ Number of Transactions) × 100%