Also called: Auth hold, Pre-auth, Pre-authorization
What an authorization hold is
An authorization hold is a temporary reduction in the funds or credit a customer has available after their card issuer approves your authorization request. The issuer reserves the approved amount for your transaction. Approval does not complete the sale or transfer money to your business.
You request the authorization and its amount. The issuer places the hold. When you submit the final transaction amount, the hold is adjusted or replaced by the completed charge. If the customer does not proceed, you need to reverse the authorization so the issuer can release the reserved amount.
An approval reserves funds, but only a correctly completed transaction turns that approval into a charge.
How estimated holds work
A hold is useful when the final bill is not known at checkout, such as at hotel check-in or when renting a vehicle. Your estimate must reflect expected spending. Visa's merchant guidance does not allow an arbitrary buffer for incidentals such as a tip or possible damage.
Tell the customer the estimated amount and that you may request later authorizations. If the estimate is too low, you can submit incremental authorizations, but they do not extend the original authorization's validity period. When the final amount is lower, send a partial reversal for the difference. For example, if you authorize $200 and the final bill is $170, reverse $30. (Illustrative.)
Visa's merchant guidance, as of 2026, sets maximum periods from estimated-authorization approval to processing: 30 days for lodging, vehicle rental, and cruise line merchants; 10 days for rental merchant categories and cardholder-initiated card-absent transactions; and 5 days for card-present transactions. If the sale will not happen, reverse the full amount within 24 hours after you know or by the end of the validity period. If the final amount is lower, reverse the difference within 24 hours of completion.
Estimate, final charge, and release
| Estimated authorization | $200 (illustrative) |
|---|---|
| Final charge | $170 (illustrative) |
| Amount to reverse | $30 (illustrative) |
The example shows a lower final amount. Send the partial reversal within 24 hours of completion under Visa's merchant guidance, as of 2026.
What it means for your costs and statement
An authorization hold does not have a separate fee amount listed in the research, but standard authorization-processing fees apply. Visa also identifies a Misuse of Authorization System Fee for approved authorizations that do not match a clearing record or reversal, and an Unmatched Clearing fee for clearing records without a matching approved authorization. These fees are not the same as the hold itself.
Look on your merchant statement for those fee names, or for network-fee entries tied to authorization or unmatched clearing activity. Compare them with your authorization, reversal, and settlement records. Incorrect message coding or late processing can also expose you to dispute liability for no authorization or late presentment.
Customers can see a pending hold before the final charge posts. If you leave the hold in place after a sale is canceled, or the final charge appears alongside a pending hold, the customer may mistake it for a duplicate charge and contact their bank.
What you can actually change
- Explain the estimate. Before requesting an estimated authorization, tell the customer its amount and that later authorizations may follow. This is required by Visa's merchant guidance.
- Reverse unused amounts. If the sale is canceled, reverse the full authorization within 24 hours of learning that it will not proceed, or by the end of its validity period. Reverse any difference within 24 hours of completing a lower-value sale.
- Match each message. Reconcile approved authorizations against reversals and settled transactions. Review any Misuse of Authorization System Fee or Unmatched Clearing fee alongside those records.
Frequently asked questions
Is an authorization hold a charge?
No. Approval reserves funds or credit with the card issuer, but it does not transfer money to your business. The completed transaction is submitted later, and the hold is adjusted or replaced by the final charge.
How long can a card authorization hold last?
The permitted period depends on the transaction type. Visa's merchant guidance, as of 2026, gives 30 days for lodging, vehicle rental, and cruise line merchants, 10 days for certain rental and card-absent transactions, and 5 days for card-present transactions.
Do authorization holds cost my business money?
Standard authorization-processing fees apply, but the research does not state a specific hold fee. Visa also identifies fees for unmatched authorizations or clearing records. Check your statement for a Misuse of Authorization System Fee or Unmatched Clearing fee.