Seven-day cancellation for online purchases
When a customer who bought online from a South African business can cancel without a reason, what must be refunded and by when, and how to record it.
By Achekam · · 4 min read · For Running a business businesses in South Africa
An online order arrives, the customer opens the box, and two days later an e-mail lands: "I've changed my mind, please refund me." Nothing is wrong with the product. The customer simply does not want it. For a shop on a high street, that might be a matter of store policy. For a South African business selling online, the law has already decided much of the answer.
The Electronic Communications and Transactions Act gives online buyers a short window to cancel without a reason, and sets out what the business must refund and by when. This guide explains the window, the refund, the one charge the business may keep, how the rule sits alongside the Consumer Protection Act, and how to record the refund properly.
Seven days after receiving goods or concluding a service agreement
The ECT Act text on the government's page gives a consumer the right to cancel an electronic transaction without reason or penalty within seven days after receiving the goods, or after concluding the agreement for services. That is section 44 of the Act as originally published; later amendments are not reflected in that text. The government's page for the ECT Act carries the official text, with its commencement and amendments.
Note where the clock starts. For goods, it is the day the customer receives them, not the day they ordered or paid. A parcel that takes a week to arrive gives the customer their seven days from delivery. For services, it is the day the agreement was concluded.
"Without reason or penalty" means the customer does not have to explain, and the business may not charge a fee for the cancellation itself. Read section 44 itself against what you sell before relying on it either way, since the right is framed around electronic transactions with consumers.
Refund within 30 days
Once a customer cancels, the Act as published says any payment must be refunded within 30 days. That is a deadline the business owns. Build it into the returns process: the cancellation date, the date goods came back if any, and a refund date well inside the 30 days.
Only the direct cost of returning the goods
The Act as published allows one charge: the direct cost of returning the goods. Everything else the customer paid is refunded.
A worked example in words: a customer buys a pair of shoes online, receives them, and cancels four days later. The business may let the customer bear the direct cost of sending the shoes back, but it refunds the full price of the shoes, and may not deduct a restocking fee or an administration charge for the cancellation. If the business chose to pay for the return courier itself, there is nothing to deduct at all.
Your website should tell customers this before they buy. The ECT Act also requires an online supplier to display specific information, from its legal name and address to the full price and payment methods; what a South African online shop must show lists it.
Where the CPA cooling-off gives way
The Consumer Protection Act has its own cancellation right for direct marketing. The CPA text published on the government's page lets a consumer rescind a transaction resulting from direct marketing within five business days, with a refund within 15 business days, and the dtic's booklet describes the same cooling-off period. But the Act as published says that section does not apply where section 44 of the ECT Act applies.
So the two rights do not stack. An electronic transaction covered by section 44 follows the ECT Act's seven days and 30-day refund; a direct-marketing sale outside it follows the CPA's five business days and 15-business-day refund. The five-day cooling-off after direct marketing covers the CPA side.
Recording a refund made in the gateway's dashboard
How the refund reaches the customer depends on how they paid.
Paid through an online payment link. Achekam does not send refunds of online invoice payments through the gateway. The refund is made in the payment gateway's own dashboard, and a person then records it in Achekam. Treat those as one task: make the refund, then record it straight away, so the gateway, the bank and the customer's account all agree.
Paid by EFT. Make the refund from the business's bank and record it against the customer.
The invoice. If the sale was invoiced, issue a credit note from the invoice it corrects, in full or for the lines cancelled. In Achekam a credit note is posted to the ledger, can be downloaded as a PDF or e-mailed to the customer, and any leftover credit is held for the customer. There is no credit note without an invoice, so the original invoice must exist.
Online cancellation routine
- Record the date the customer received the goods, or concluded the service agreement.
- When a cancellation arrives, check it is within seven days of that date.
- Agree how the goods come back and who pays the direct return cost.
- Issue the credit note for the cancelled lines.
- Refund the full payment, less only any direct return cost, within 30 days.
- Record the refund in Achekam on the day it is made.
Seven days is a short window for the customer and a long one for a business that has no process. Set the routine up once, and a refund handled quickly and recorded cleanly becomes part of selling online rather than an exception to it.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
