Pre-authorization is a service offered by credit and debit card providers, where the provider puts an amount (approved by the cardholder) on hold until either the transaction is completed or aborted, or the hold expires.
In essence, the money hasn't been taken out of the customer's account: it is in 'pending' to ensure that the money is there for the merchant to process if required. It also verifies that the card is valid and the amount is available to be used if the merchant finalizes the transaction.
The hold of these pre-authorizations is 30 days; if no action is taken, the pre-authorization expires and funds are returned to the cardholder without action (however, this is not instant and can also take up to 30 days to be released from the cardholder’s reserve). Merchants can also manually release the hold early using tools, such as a Paynt payment terminal.
How to achieve finalisation of pre-authorization and charge funds:
1. Pre-authorization happens via terminal “preauth“ function, seen below:
2. Once approved, the terminal provides a receipt with a QR code; If you want to proceed with the pre-authorization, you need to scan QR code from the receipt and choose the option “completion“. It will then give a receipt for a successful transaction, and the pre-auth amount is immediately deducted from the cardholder's account.
3. If you need to cancel the pre-auth, once you scan the QR code, instead you should choose the option 'Invalidate'. It will then ask you to input details from the receipt, or scan the QR code again; once details are inputted or QR code is scanned, the pre-auth amount is immediately refunded to the cardholder's account.
If you have any questions or you need assistance please contact our support team. You can reach us through the chat available in the Paynt Portal, or email our support team on [email protected]