08 May Pre-Authorized Payments
What is a Pre-Authorised payment?
A Pre-Authorised payment is where your business, as a merchant, can ensure your customers pay for the products and services they use. This is done by essentially putting a temporary hold on a customer’s credit card, and reserves funds for a future payment transaction
How long is a Pre-Authorised payment usually held for?
The hold on a payment can be up to 5 days. However, this is determined by the type of product or service you are offering. This can also be because of the type of merchant classification code (MCC) your business is aligned to.
What sort of businesses commonly use Pre-Authorised payments?
- Car Rental Agencies
- Tour Operators
- Activity Providers
What are some of the benefits of Pre-Authorised payments?
Pre-auth payments ensure that your customers pay for their services as they cannot leave without paying for the services they have used.
Pre-auth payments can help your business avoid chargebacks as the funds have not yet been captured as it is not a confirmed charge open to dispute
Pre-auth payments can improve customer satisfaction as you may need to cancel a customer’s booking or reservation after they have been confirmed. The customer has not paid for the booking, only agreeing to the pre-auth, so this makes the process much simpler.
Is your business one that may require pre-authorized payments? If so, please contact us to learn more!