Refundable fee
A refundable fee is a challenge fee the firm returns to you after you succeed — commonly once you reach the funded stage or receive your first payout. Fail the challenge, and the firm keeps it.
Evaluation fees are priced by account size, commonly $50–$600 per attempt. Where the refund lands varies: many firms return it with the first payout, some on activation of the funded account, and some spread it across several payouts. An account breach at any point normally forfeits it.
The economics are straightforward. Commonly cited pass rates are low, so fees from failed attempts are the main revenue at many firms; the refund is a rebate paid only to the minority who reach the payout stage, which keeps the headline "free if you succeed" true while the median attempt still pays full price.
Refund terms sit in the fine print: paid resets and repeat attempts are commonly non-refundable, promotional discounted fees sometimes carry no refund at all, and the refund usually requires the funded account to be in good standing when it is due.
In a prop-firm challenge
The refundable fee is best read as the price of one attempt, refunded only along the narrow path where everything goes right. Budgeting for several attempts at full price is the commonly cited arithmetic, laid out with real numbers in what a prop firm challenge costs.