Most merchants do not need to change these settings.
Please only make changes if you know how this effects what customers can return.
Example Unfulfilled Order: a merchant wants customers to be able to return an order as a quasi cancellation for their order when the order itself has not shipped, yet. Note that we do not cancel the order, this has to be done manually. The return portal is merely used for logging the cancellation request of the customer. When staff then sees such a return in the dashboard they'd cancel the order in Shopify and mark the return as resolved.
Example Pending Payment: a merchant wants customers to be able to return an order when payment is settled in cash (e.g. courier) and there is a time delay in registering the transaction (manually) so the customer can already initiate a return.
Example Authorized Payment: a merchant wants customers to be able to return an order when payment has been authorized on the customer's end but not captured on the merchant's end. A payment usually goes instantly from authorized to paid in Shopify.
In your Rich Returns dashboard navigate to Return-Settings / General / find the section below. Enable the options that fit your business processes and hit save at the bottom of the page.