Matched BetsRefund offers: how to lay them
Short answer
A refund offer gives you a free bet if your cash bet loses. Lay it with lay stake = (S × B − refund × conversion) ÷ (L − c), where conversion is how much of the free bet you expect to keep (often 70–80% for SNR). A £10 bet at 3.0, laid at 3.1 with 2% commission and a £10 refund at 80%, needs a £7.14 lay and is worth about £5 either way.
What a refund offer is
Typical wording is "money back as a free bet if your first bet loses" or "bet refunded if your horse finishes second". You place a cash bet; if the condition is met, the bookmaker credits a free bet. Unlike a qualifying bet, you don't need the losing side to break even in cash — the refund will make up some of the loss later.
The refund is a free bet, not cash. You only turn it into cash when you use it and lay it, and most free bets are stake not returned, so a £10 refund is usually worth around £7 to £8 once converted.
The formula
S is your back stake, B the back odds, L the lay odds, c the commission as a decimal, R the refund amount and r the conversion rate you expect (80% = 0.8). R × r is the value you're counting on from the refund. Compared with a qualifying bet, the lay is smaller because the refund already covers part of the losing side.
Worked example
£10 back at 3.0, lay at 3.1, 2% commission, £10 refund if the back loses, expected conversion 80% (£8.00):
(10 × 3.0 − 8.00) ÷ (3.1 − 0.02) = 22 ÷ 3.08 = £7.14 lay, with £14.99 liability.
| Outcome | Bookmaker | Exchange | Cash | Plus refund |
|---|---|---|---|---|
| Back wins | +£20.00 | −£14.99 | +£5.01 | — |
| Lay wins | −£10.00 | +£7.00 | −£3.00 | +£8.00 → £5.00 |
If the back wins you have £5.01 in cash straight away. If it loses you're £3.00 down in cash with a £10 free bet that should convert to about £8.00, for roughly £5.00 overall — but only once you've used it.
Standard, underlay or overlay?
Because one side relies on a free bet you haven't converted yet, many people choose where the profit lands. Same example, all three strategies:
| Strategy | Lay stake | Liability | If back wins | If lay wins |
|---|---|---|---|---|
| Standard (balanced) | £7.14 | £14.99 | +£5.01 | −£3.00 cash + £8.00 refund |
| Underlay | £5.71 | £11.99 | +£8.01 | −£4.40 cash + £8.00 refund |
| Overlay | £10.20 | £21.42 | −£1.42 | £0.00 cash + £8.00 refund |
- Standard evens out the expected value: about £5 whichever side wins.
- Underlay takes a bigger cash win if the back wins (+£8.01), and leans on the refund if it loses. Lower liability, too.
- Overlay means losing the back costs you no cash at all, so the refund is pure profit; you pay £1.42 if the back wins.
None of these is "best". Underlay and overlay favour one outcome, so look at both results before you bet and make sure you're comfortable with the worse one.
How the conversion rate changes the lay
The lower your expected conversion, the closer the lay gets to a normal qualifying bet:
| Expected conversion | Lay stake | If back wins | If lay wins (incl. refund) |
|---|---|---|---|
| 80% (£8.00) | £7.14 | +£5.01 | +£5.00 |
| 70% (£7.00) | £7.47 | +£4.31 | +£4.32 |
| 0% (ignore the refund) | £9.74 | −£0.45 | −£0.45 |
Be honest about conversion. If you usually keep 75% of an SNR free bet, use 75%, not 80%. Higher odds tend to keep more of a free bet's value but need more liability — see SNR vs SR free bets.
When the refund only pays sometimes
The formula assumes the refund arrives whenever your back bet loses. Many offers are narrower — "refund if second", "refund if a goal is scored after 80 minutes", "refund if your team loses by one goal". The refund then only covers some of the losing outcomes, so:
- Lay it as a normal qualifying bet (conversion 0%), and treat any refund as a bonus when it lands.
- Or, if you understand the odds of the refund triggering, use an expected value — but accept that most of the time you'll get the qualifying loss and no refund.
Check before you bet
- Is the refund cash or a free bet? A cash refund converts at 100%.
- Is the free bet stake returned or not? That changes what it's worth.
- Minimum odds, eligible markets, expiry and maximum refund.
- Do you have enough in your exchange account for the liability?
Recording a refund properly
The refund isn't money until you've used it and the result has settled. Matched Bets shows refund value separately from cash and never adds it to your profit until you record the free bet and settle it, so your totals only ever show cash you actually made. Run your own numbers in the free calculator — choose Refund and set the award and conversion.