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Difference Between Refund and Rebate

Refund vs Rebate

Refund and Rebate are two words that are often confused as words that give the same meaning. Actually they are not so. There is of course some difference between the two words.

A rebate is an amount paid by way of return on what has already been paid by the customer for the purchase of a product or a service. A rebate is a kind of tool used in the sales promotion techniques of marketing.

On the other hand a refund is the return of the entire money paid by a customer on the purchase of a product or service. The amount returned by way of refund may be due to dissatisfaction expressed by the customer or due to any other valid reason. There is no element of dissatisfaction on the part of the customer in the case of a rebate form of sales promotion. This is the main difference between refund and rebate.

A rebate is to attract customers whereas a refund is to satisfy a customer. Rebates may be given in the form of coupons or gift vouchers whereas refund is always given in the form of cash or money. Rebates forms are available online or even printed at the cash register at the time of purchase. It is important to know that rebates are offered either by the manufacturer or by the retailer.

The form has to be sent by the buyer by mail in order to receive the amount of rebate either by cash or by check. Rebate is characterized by some rules and regulations. On the other hand refund is not featured by rules and regulations. The buyer or the customer has to simply express his dissatisfaction at the quality of the product purchased in the case of a refund. Sometimes refunds are given after the customer files a suit in the consumer courts.


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