Capture Operations

TL;DR

• Void before settlement (before capture) costs nothing; refund after settlement loses interchange fees you can't recover - void early for cancellations when possible
• Partial capture is allowed when you can't fulfill the full order (e.g., split shipment); capture only what you've shipped to avoid disputed charges on undelivered items
• Re-authorization is required when an auth window expires before you can capture; the card may have been cancelled or funds may have been moved
• Multi-capture (capturing a single auth in multiple transactions) requires processor support and specific network rules compliance - confirm before implementing

Capture operations are the post-authorization actions that determine when money moves and what it costs you: holds, partial captures, voids, refunds, and re-authorizations. Voiding an uncaptured transaction costs $0, while refunding after settlement costs interchange twice. On 100 refunds/month at $100 average, that difference is $350/month.

---

Pre-Authorization Holds

Pre-auth holds are temporary reservations on a cardholder's credit line. They're not charges, but they affect available credit.

How Holds Work

Hold Duration by Card Type

Card Type	Typical Hold Duration
Credit cards	7-30 days (network dependent)
Debit cards	2-10 days (bank dependent)
Prepaid cards	Often longer, varies wildly

Debit Card Holds

Debit holds tie up actual cash, not credit. A $200 hotel hold on a debit card with $250 balance leaves the customer with $50 available. This creates support calls and customer frustration. Consider requiring credit cards for high-hold industries.

Hold Release Scenarios

Scenario	What Happens
Capture matches hold	Hold converts to charge immediately
Capture less than hold	Excess releases (timing varies)
Capture more than hold	Second auth or over-tolerance capture
No capture (void)	Hold releases faster if merchant voids
No capture (expiry)	Hold releases when auth expires

Best Practices for Holds

• Authorize only what you'll capture. Over-authorizing creates customer complaints.
• Void unused authorizations. Don't let them expire naturally.
• Warn customers about hold amounts. Especially for hotels, rentals, and gas stations.
• Use credit-only for high-hold industries. Consider not accepting debit for car rentals.

---

Partial Captures

Sometimes you capture less than the authorized amount. This happens with split shipments, partial fulfillment, or order modifications.

Partial Capture Scenarios

Scenario	Example
Split shipment	Customer orders 3 items; 2 ship now, 1 backorders
Partial availability	Ordered 10 widgets, only 7 in stock
Order modification	Customer removes item before shipment
Partial service	Hotel guest checks out early

How Partial Capture Works

Network Rules for Multi-Capture

Network	Multi-Capture Support
Visa	Yes, with multi-clearing flag
Mastercard	Yes, with final indicator on last capture
Amex	Yes, limited scenarios

Operational Considerations

• Track capture totals. Don't exceed original auth amount.
• Use proper flags. Indicate partial vs. final capture correctly.
• Communicate to customers. Explain why they see multiple charges.
• Reconciliation complexity. One order = multiple capture events in settlement.

---

Void vs. Refund Decision

Void and refund both return money to the customer, but they're different operations with different costs.

The Difference

Aspect	Void	Refund
When possible	Before capture/settlement	After capture/settlement
Interchange cost	Little to none	You pay interchange again
Customer timing	Hold releases in 1-3 days	Funds return in 3-10 days
Chargeback ratio	Doesn't count	Doesn't count (but chargebacks do)
Accounting	Transaction disappears	Two transactions (charge + credit)

Decision Flow

When Void is Not an Option

• Transaction already in settlement batch
• Settlement batch already sent to processor
• Funds already moved
• Processor doesn't support void after certain time

Cost Impact

$100 transaction	Void	Refund
Original interchange (~2%)	$2	$2
Return interchange	$0	$2 (paid again)
Net cost to you	$2	$4

Rule: Void when you can. Refund when you must.

---

Re-Authorization

Authorizations expire. If you haven't captured when the clock runs out, you need a new authorization.

Why This Matters

• Expired auths can't be captured
• Re-auth might fail (card maxed, closed, or stolen)
• Capturing against expired auth = chargeback risk

Proactive Re-Authorization

If you know you'll miss the auth window:

1. Re-authorize before expiry. Get fresh approval while old auth still valid.
2. Void the old auth. Release the hold.
3. Track the new auth. Update your order records.

Re-Auth Failure Handling

Failure Reason	Action
Insufficient funds	Contact customer for alternative payment
Card expired	Request updated card
Card lost/stolen	Contact customer for new payment
Generic decline	Contact customer or cancel order

See decline codes for specific handling.

When to Re-Auth

Scenario	Re-Auth Timing
Pre-order with 30-day ship date	Re-auth 2-3 days before shipping
Custom/made-to-order	Re-auth when production complete
Backorder extended	Re-auth every 7 days. That's the shortest of the three networks, not the rule: Visa CNP allows 10 calendar days, Mastercard and Amex allow 7
Subscription trial ending	Re-auth at trial end

Communication Templates

Email when re-auth fails:

"We were unable to process your payment for order #1234. Your card on file was declined. Please update your payment method within 48 hours to avoid order cancellation."

Email when re-auth succeeds:

"Good news! Your order #1234 is ready to ship. Your card has been charged $X."

---

Partial Authorizations

A partial authorization is when the issuer approves only part of the requested amount.

How Partial Auth Works

1. Merchant requests $100 authorization
2. Issuer responds: "Approved for $70" (cardholder has $70 available)
3. Merchant must decide: accept $70 or decline transaction entirely

When Partial Auth Occurs

Card Type	Partial Auth Common?
Prepaid/gift cards	Very common
Debit cards	Common
Credit cards	Rare

Handling Options

Option	When to Use
Accept partial, request second payment	Customer can pay remainder another way
Decline entire transaction	Single-payment only (e.g., gas pumps)
Split tender automatically	POS supports multiple payment methods

Implementation Considerations

Consideration	Details
POS/system support	Must handle partial auth response
Customer communication	Explain why partial occurred
Second payment flow	Have fallback payment method ready
Refund complexity	Two payments = two potential refunds

Best Practices

• Enable partial auth for prepaid-heavy merchants. Gift cards are often used with other payment.
• Decline partial for automated/unattended. Gas pumps, vending can't request second payment.
• Train staff on split tender. They need to know how to complete the transaction.

Prepaid/Gift Card Rule

If you sell gift cards or have significant prepaid traffic, enable partial authorization. Otherwise, customers with $40 on a gift card can't buy a $50 item.

---

Next Steps

Managing holds?

1. Understand hold duration - Credit vs debit vs prepaid
2. Follow hold best practices - Authorize what you'll capture
3. Warn customers about debit - Real cash tied up

Doing void vs refund?

1. Know the cost difference - Void saves interchange
2. Follow decision flow - When void is possible
3. Track voiding opportunity - Before settlement

Handling re-authorization?

1. Know when to re-auth - Pre-orders, backorders
2. Handle failures gracefully - Customer communication
3. Capture within window - Network-specific timing

---

See Also

• Authorization and Capture - Core concepts
• Authorization Windows - Network-specific timing
• Settlement & Reconciliation - Where money flows
• Decline Codes - Understanding failures
• Interchange Optimization - Fee management