If you have all configs checked, just verify the Channel Return Policy. Make sure that the credit memo is listed as a valid return tender type. The error message is usually different, but worth a try. Also try a 9999 full sync as your configuration seems to be all good.
Yes, the button action is issue credit memo and also the payment method is attached to retail store .
i followed the doc you sent and there is nothing missing at my configuration.
this issue happens on two different environments and occurs at the store commerce and CPOS too.
Make sure the button action is set as 'Issue credit memo'. Also, probably the payment method is not attached to the retail store channel in HQ. Refer the below doc for more details on the setup.
What do you mean with 'Configured'? Is it an extension/customization?
Best regards,
Laurens van der Tang
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