Significance and working of constraints while using an option -Refund To New Payment Method

Answer

Example Scenario:
Consider a payment method - Gift Card (GC), which is having a refund configuration such that it is refunding to a new payment method - Cheque.
It has one constraint mentioned in configuration as - If refund amount is less than $50 then refund using Cash.
Refund configuration of Cheque mentions that it will use Cheque itself as the refund payment method.

Now when order is placed for $40 using GC then, from above explanation, it will appear that product should refund the amount using Cash as it is less then $50.
However, this is not the way Sterling OMS behaves. While processing this request, product will first look for the refund payment type of GC, which in this case is Cheque.
Now, Product will check the refund payment method configured for Cheque, which is nothing but the Cheque itself. And there is no further constraints mentioned in the Cheque refund configuration, as it was for GC, product will use the Cheque to refund the amount and not Cash.

In Summary, Product will use the refund configuration of the new payment method to find out the refund method and not the original payment method mentioned.