Offering refunds for damaged items only

This rule can be used if you generally offer store credit and exchanges, but want to offer refunds only to customers who have received a damaged item. Once you've enabled refunds in your Return Settings, here's how you can set this up: 

It's easier to think of this in the inverse where rules are used to limit options for certain customers. In this case, if you offer refunds, store credit, and exchanges overall, but only offer refunds to some customers, your rules will restrict the options for the rest of the customers to be store credit and exchanges only. 

This rule shows that where a customer has selected reason other than damaged item, they will see only store credit and exchanges. However, if they have selected "damaged item", they'll see the options in full, including original payment method refund.