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Return Material Authorization (RMA)

Definition - What does Return Material Authorization (RMA) mean?

Return material authorization (RMA) is an e-commerce term that describes an arrangement in which the supplier of a good or product degrees to have a customer or client ship that item back to them in exchange for a refund or credit. This sort of agreement, which is also called a return merchandise authorization or returned goods authorization, allows for a higher degree of guaranteed quality.

RMA can be important for goods sold online because consumers don't have the benefit of being able to fully assess what they're buying and must rely on descriptions and photos to determine quality. In many cases, however, a return material authorization is used for a software package or technology product, and is applicable within a specified warranty period. In other cases, the provider will authorize this kind of agreement at any future point when the user experiences a defect or malfunction in the product.

Techopedia explains Return Material Authorization (RMA)

Although in other industries a return material authorization often applies to physical products, in IT, this type of transaction may involve a software license rather than a physical product. In these cases, the supplier and the customer can negotiate over future licensing authorization, whether this involves additional licensing for operating systems or areas of an IT infrastructure, or application of a license credit to the purchase of other products or additional versions of a software package.

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