How should a system account for prepaid services, class packs and visit cards?
Conclusion: a prepaid-service product needs more than a remaining-balance field. Keep the customer's contract, cash received, entitlements issued, each fulfilled service, authorised adjustments and final refunds as separate linked records. Calculate remaining money or visits from that history. This design lets the business explain pauses, transfers, bonuses, partial refunds, use across locations and expiry without asking staff to reconstruct the transaction from messages.
Audience and scope
This article is for consumer-service businesses—including fitness, personal care, education, hospitality, retail, elder care and travel—that take payment before delivering goods or services over time. It also applies to organisations replacing paper cards, branch spreadsheets or disconnected point-of-sale balances with a shared operating record.
The regulatory facts below apply to mainland-China consumer scenarios as at 10 September 2026. China's Regulation for Implementing the Consumer Rights Protection Law has applied since 1 July 2024. Article 22 requires a written contract for prepaid goods or services covering the service, price or charge, refund method and breach responsibilities. A Supreme People's Court interpretation effective from 1 May 2025 addresses prepaid-consumption disputes, including contract terms, transfer, termination, refunds and evidence about usage and balances. Local, sector-specific and single-purpose prepaid-card requirements still need legal review.
Six commercial rules to settle before software design
What exactly has the customer bought?
Separate stored money, a fixed number of visits, a class-hour pack, time-limited access and promotional entitlements. “Buy ten, receive two” should identify where each paid and bonus visit can be used, its validity and its treatment on refund. A total of twelve visits hides materially different rights.
What event proves fulfilment?
Booking, arrival, service start, service completion and staff close-out are different events. Choose the point supported by evidence and define late arrival, no-show, cancellation, interrupted service and staff error. Higher-dispute services may require customer confirmation or manager review; unrestricted back-office deductions are not an adequate control.
How do pause and expiry work?
Define eligible reasons, approval, maximum duration, expiry extension and whether booking or transfer remains available during a pause. Communicate approaching expiry under the contract. After expiry, keep an explicit state for stopped use, grace, reviewed extension or refund treatment; never erase the underlying entitlement.
When can rights move between people or locations?
Distinguish named and bearer rights, the original holder's confirmation, receiving-site obligations and the evidence retained for both parties. Any restriction on transfer needs legal review. Removing a transfer button does not by itself make a restriction enforceable.
How is a refund calculated?
The method must address unused prepayment, delivered services, bonuses, reversal of discounts, invoicing, charges and return to the original payment method. Show the calculation and evidence to an authorised approver. Customer-service staff should not calculate a number externally and overwrite the balance. Legal and finance owners must approve the rule applied when a contract is terminated, invalid or otherwise refundable.
What happens when the business changes materially?
Relocation, site closure, transfer of service to another operator or financial distress can affect the ability to fulfil. The business needs to identify affected customers and unfulfilled rights, stop inappropriate new sales and manage continued service or refunds under the applicable contract and law. Records must be searchable by location, product, contract version and outstanding obligation.
Six linked ledgers behind one customer balance
| Record | Core facts | Why the history matters |
|---|---|---|
| Contract | Product, service, quantity, validity, eligible locations, pause, transfer and refund terms, version | Establishes the promise at purchase |
| Payment | Amount due and received, channel, time, transaction reference, invoice and refund destination | Separates commercial value from cash movement |
| Entitlement | Paid and promotional units, scope and validity | Prevents money, visits and access from being conflated |
| Fulfilment | Booking, attendance, service, location, worker, time and evidence | Shows what was actually delivered |
| Adjustment | Pause, extension, transfer, correction, compensation, reason and approval | Explains every non-standard change |
| Refund and closure | Remaining rights, calculation, approval, refund transaction and contract state | Prevents use after settlement |
The customer interface can remain simple. The operating record must allow a user to drill from the balance to these transactions. Corrections should add reversing or correcting entries, not rewrite prior events.
Implementation and procurement boundary
First, inventory every active product, contract form, price list and branch variation, and stop creating informal unreviewed packages. Second, use actual purchase, cancellation, pause, transfer, cross-site use, partial refund, expiry and closure examples to agree states and calculations. Third, record imported balances with their cut-off date and source, separate from transactions created in the new system. Finally, pilot one product family at a small number of locations through a complete service cycle.
Define which component owns contracting, signature, point of sale, payment, invoicing, booking, fulfilment, employee compensation, refunds, messaging and accounting. Configure an existing platform where it supports the approved rules and reliable export. Custom development is justified where multi-location obligations, composite benefits, specialised fulfilment or integration create a verified gap.
The business case must include legacy reconciliation, contract review, branch training, customer communication, payment refunds, access control and ongoing reconciliation. Useful measures include balance differences, dispute-handling time, manual adjustments, expiry complaints, branch close effort and explainable renewal—not raw card sales alone.
Acceptance checklist
- Customers can see the purchased service, paid and bonus rights, validity, usage and remaining entitlement.
- Retries and concurrent branch activity cannot consume the same right twice.
- Staff cannot delete history; reversals, compensation and extensions record reason, authority and approval.
- Pause, transfer, cross-site use, refund and expiry follow the applicable contract version rather than today's default.
- Refund details connect the original payment, fulfilment, remaining rights, approval, transaction and closed state.
- Imported opening balances reconcile to the previous system or signed evidence, with differences tracked separately.
- Branch close, operational entitlement and finance cash records can explain differences transaction by transaction.
- Management can identify obligations by site, product, expiry window and outstanding value.
Common mistakes
Treating one balance as the complete record. It cannot prove what was purchased, where it applies or why it changed.
Applying a new rule retroactively to every legacy pack. Contract terms need versions and effective dates. Valid changes and customer acceptance require their own evidence.
Combining promotional and paid rights. Consumption order, expiry and refund treatment often differ; a combined bucket guarantees manual interpretation.
Asking legal to review after development. Refund, transfer and standard terms shape the data model, permissions and operational workflow. They belong in discovery.
Ongoing controls
Reconcile payment, entitlement issue, fulfilment, reversal and refund exceptions daily. Review dormant balances, frequent manual adjustments, upcoming expiry, negative balances and site differences monthly. Review product rules, contract versions, access and customer notices quarterly. Retiring a product should stop new sales while preserving contracts, transactions and customer access for the applicable retention period.
For products that add recurring charges rather than prepaid visits, see Which six billing rules must a paid membership or subscription specify?.
Sources
- State Council of China: Regulation for Implementing the Consumer Rights Protection Law (promulgated 15 March 2024; effective 1 July 2024; accessed 10 September 2026)
- Supreme People's Court: Interpretation on the application of law in prepaid-consumption civil disputes (promulgated 13 March 2025; effective 1 May 2025; accessed 10 September 2026)
This is a product-scope and acceptance framework, not legal or accounting advice. Qualified owners should confirm contract, refund, transfer, tax and funds-management rules for the operating location and sector.