Understanding the difference between Cancel and Refund actions is essential in payment processing as each action serves a distinct purpose depending on the payment’s current state

Overview

In a typical payment lifecycle, the following actions are available:

Authorize a payment — place a temporary hold on funds
Capture the funds — complete the transaction, either immediately or with a delay. Full capture or partial capture may apply.
Cancel the authorization — void the hold if the payment hasn’t been captured yet
Refund the funds — return money to the customer after a capture. Full refund or partial refund may apply.

Choosing between Cancel and Refund depends on the timing and status of the transaction. Using the correct operation ensures accurate reconciliation and improves the customer experience.

Authorization

A temporary hold on the customer’s funds. Funds are not transferred until the payment is captured.

Authorization expiration varies by card network.
Can be canceled (voided) if capture is not yet performed.

Capture

The action of finalizing a payment, moving money from the customer to the merchant.

Can be direct (immediate capture) or delayed (authorize now, capture later).
Can be full or partial.
Once captured, only a refund can done to return funds to the customer.
Refund does not reverse the initial transaction. It is an additional step in the payment flow of the initial transaction.

Action	Definition	When to Use	Effect on Customer	Availability
Cancel	Voids a payment authorization before capture. No money is moved.	Before capture, if the customer changes his mind or the transaction fails checks.	No charge appears on the customer’s account or it disappears after a short time.	Only possible while the payment is authorized and not captured yet. Not possible if direct capture was used.
Refund	Returns funds to the customer after capture.	After capture when merchant wants to reverse the amount (fully or partially).	Customer sees a charge and a refund on their account.	Available only after capture. Can be full or partial. Several partial refunds can be made until the full amount is refunded.

API Reference: Payment Cancellation & Refund

This section provides reference examples for canceling and refunding payments via the API. Make sure to verify the current status of the payment (authorized, captured, etc.) before choosing the appropriate action. For a full API documentation, go to our API Reference.

Cancel a Payment Authorization

Use this endpoint to cancel a payment that has been authorized but not yet captured.

POST /payment/maintenance/cancel/{order_id}

Refund a Captured Payment

Use this endpoint to fully or partially refund a payment that has been captured.

POST /payment/maintenance/refund/{order_id}