For destination charges and separate charges and transfers (platform-first charges), who issues refunds?

For destination charges and separate charges and transfers (platform-first charges), who issues refunds?

• A. The customer via the portal
• B. The platform via API call
• C. The merchant via gateway
• D. Stripe automatically refunds after processing

Answer: (B)

In these Stripe Connect flows, the platform is the entity that initially charges the customer and holds the transaction, then either transfers funds to the connected account (destination charges) or handles the platform-first charge itself. Because the platform controls the charge, it must initiate refunds to reverse the transaction. This is done by making an API call to Stripe to create a refund against the original charge. The customer cannot issue the refund through their portal for these charge types, and refunds aren’t automatically handled by Stripe. The platform is responsible for managing refunds to ensure proper accounting and fund reversals within the Connect framework.

In these Stripe Connect flows, the platform is the entity that initially charges the customer and holds the transaction, then either transfers funds to the connected account (destination charges) or handles the platform-first charge itself. Because the platform controls the charge, it must initiate refunds to reverse the transaction. This is done by making an API call to Stripe to create a refund against the original charge. The customer cannot issue the refund through their portal for these charge types, and refunds aren’t automatically handled by Stripe. The platform is responsible for managing refunds to ensure proper accounting and fund reversals within the Connect framework.