Discount code refunds are a great way to retain your customers by incentivizing them to continue shopping for your products. When a customer requests credit for their return you have the option to automatically create a discount code for the order amount and email it to the customer.
Note: This feature is available only on the Gold plan.
To activate this feature you will need to have 'Refund within the app' setting ticked in the Setup section.
Customer requests credit for their refund via the return portal.
You will then mark as received when the item has been received back.
If you now click 'Refund' - the green button below
Select the items or quantity to refund
Add the credit amount
Confirm the refund on the refund pop-up window
Discount code for the value set is automatically created and emailed to your customer
You can see the issued discount codes under the Discount section of Shopify Admin