Talk:Authorization hold

First person

Way too much first person in this article, somebody needs to clean that up. Liquidtenmillion 16:40, 23 June 2006 (UTC)

$1 authorization

We could also include something about the $1 authorization common among online merchants. Gordeonbleu 17:51, 8 October 2006 (UTC)

wow

Can anyone confirm or deny whether a merchant can act to void an authorization hold? And provide a citation, please? MaxBrains (talk) 10:46, 15 February 2008 (UTC)

Preauth + Force?

I know for a fact, because i did this as an experiment, that a merchant can get a $1 authorization and settle at ANY ammount, and will still receive the funds, even if it puts the customer in to the negative (checking account), or exceeds the credit limit. for example, say you want to purchase a item that cost $500, but only have 30 in your checking.... if i authorize $30 i can settle at 500, getting me the funds, you the item and a bounced checking account. important to note this. —Preceding unsigned comment added by 71.201.151.133 (talk) 15:50, 18 March 2008 (UTC)

They don't need to do authorization at all, so the $1 amount doesn't matter. Any acquirer can issue a settlement for any amount against any card and by default it will be accepted. The only "security" is that it's not trivial to become an acquirer, but there is no technical barrier to massive fraud by acquirers. In the UK "Co-operative Food", a supermarket, mistakenly re-issued an entire day's settlements. Hundreds of thousands of electronic settlements that were exactly identical to ones they'd already done. The banks handed over the money, no questions. Only when actual human customers began to complain that they'd been double-charged did anybody notice the problem. http://www.moneysavingexpert.com/news/shopping/2015/07/co-op-shoppers-hit-by-double-charge 2001:8B0:FBB0:1247:21A:4DFF:FE96:2C2B (talk) 11:00, 18 April 2016 (UTC)

Source?

I am not saying that I don't believe this article. My mom owns a small restaurant and we know that this is true. Our acquirers place a 25% hold on top of what the customer pay. I've tried with my own atm card and they do return the money after a few business day (I did it on friday and got it back tuesday morning). But some customers don't believe us. Some even threaten to sue us (one guy actually contacted a lawyer before contacting us). Anyway, does anyone have a link to a reputable source on the subject? I would like to print them out keep a copy at the restaurant. I read one article on reader's digest, here's the link if anyone interested (2nd part under "Know When to Hold 'Em"). http://www.rd.com/advice-and-know-how/debit-card-traps-and-fees-to-avoid/article50626.html Elsonlam1 (talk) 04:20, 19 March 2009 (UTC)

Records?

Are records kept of authorization holds, such as showing up as a transaction on your credit card statement? 128.183.110.112 (talk) 19:36, 24 September 2009 (UTC)

Bias against retailers?

This wiki appears to put the onus on the merchant...when the banks set debit hold limits and manage when debit holds are released. Folks, retailers just accept plastic, they don't set the rules for accepting plastic. (Mjdol1 (talk) 21:38, 16 October 2009 (UTC))

Borrowing money?

I removed the following text, which has been marked unsourced for six months:

Essentially, the banking industry borrows $75 or $100 dollars from the buyers bank account, then pays it back with in a few days, interest free. At any given time, there are thousands of transactions taking place. The borrowed money can be pooled together by the private financial entity, creating a money reservoir from which they can gain interest.

This statement strikes me as extremely doubtful, so should not be accepted without strong citation.

With few exceptions, all money on deposit with a bank is part of the reservoir of funds which they can lend out at interest, subject to reserve requirements. That is how the bank is able to pay interest on interest-bearing accounts and how the bank is able to offer free checking for non-interest-bearing accounts and still make a profit.

When a bank places an amount on hold and reduces the available balance, it knows that said amount will probably be transferred outside the bank within a few days, yet the bank must continue to pay interest on the amount until the journal balance is reduced, which does not happen until the transaction settles. While I am certain that the bank incurs no loss because of this fact, I cannot see how it could earn excess profits from it. Robert A.West (Talk) 21:32, 13 September 2010 (UTC)

I think it's OK to remove it without sourcing. Magog the Ogre (talk) 21:38, 13 September 2010 (UTC)

What about the early days

I'd like someone who knows this to add a section about what happened in the early days of credit cards before computers were involved. Like the 70s and 80s. When they used those manual knuckle buster machines; and had no way of verifying credit limit. if there is information available Id be very interested to know how fraud was prevented on behalf of the cardholder. Ie, purposely spending way over the limit with no intention of paying. — Preceding unsigned comment added by 23.25.56.45 (talk) 14:05, 24 May 2012 (UTC)

Haven't merchants always required an authorization before they will accept the card? Magog the Ogre (talk) 20:42, 24 May 2012 (UTC)

Telephone authorisations were (and are) available to merchants. Mauls (talk) 15:30, 3 March 2017 (UTC)