I need to refund security deposit to a tenant. I want to make bank transfer, not write check. Like with vendor bill, I want to pay directly via bank account.

Thanks @Adrian_A - when I follow the steps to create a new clearing account, there is a mandatory "Detail Type" drop-down that is not explained in the "setup clearing account" link. Neither of the types to choose from match the described purpose of the clearing account. Also, this seems to me an intermediate account for recording purposes, but it does not have an online payment option like invoice or bill.

The documentation says "You can pay out of a bank account via Write Checks or Pay Bills" - since I do not want to use checks the only other option in QBO is to use Pay Bills. The Pay Bills requires that I enter a bill, it cannot work with Credit Memos or refunds. Bills only accept vendors as payees, it does not accept customers. Moreover, I cannot create a vendor with the same name as customer, QB says "something's not right...". I am not sure why my customer can't also be my vendor - e.g. my tenant can do work for me and be my vendor independently from being my customer.

I can overcome the problem of adding my customer as vendor by making their display name different. Can anyone please answer my previous question: are there any implications of making a refund to a customer via the Pay Bills system like to a vendor? Is this going to be treated as their income and my expense or something like that? Thanks!