The Pre-Authorisation App is perfect for Hotels, Hire Car Companies, Clubs, Pubs and anyone that needs to reserve funds from a customer’s card. Just as the name suggests the Pre-Authorisation App allows a Merchant to put aside a specific amount of money until the good or service is provided. At which point the Merchant can finalise the transaction.
Perfect for Hospitality
For example a Hotel may use the Smartpay Pre-Authorisation App to reserve funds from the customer’s card to cover the cost of the room. Once the customer has checked out the Hotel staff will complete the transaction by taking the Pre-Authorised funds as payment.
The new Bar Tab
Equally a Bar may use the Pre-Authorisation App to reserve funds for a customer’s bar tab. Finalising the transaction at the end of the evening. This ensures the customer is able to pay the Merchant before the drinks are supplied without keeping the customer’s credit card. Merchant’s are now able to reduce their chances of fraud and theft with no inconvenience to the customer.
IMPORTANT INFO: Pre Auth is a Two Stage Process
The Pre Authorisation App requires a two step process when completing transactions on your terminal.
AUTH – this reserves the money that the merchant requires. These reserved funds are unavailable for use by the cardholder until either the transaction is finalised or the hold on the funds has exceeded it’s expiry period. Pre-Auth functionality must be authorised by both the Merchant Bank and Paymark before it can be enabled on your EFTPOS terminal. Pre-Auth transactions are stored securely in the terminal memory; however merchants must retain their Pre-Auth EFTPOS receipts in case of unforeseen hardware or software issues.
FINALISE – A Finalise transaction is the completion of a stored Pre-Auth transaction. To receive payment the merchant must complete the transaction (Finalise) once the goods or service is provided. Pre-Auth funds are generally reserved for 7 to 14 days, but the hold period can be less or more and is dependent on the bank and card issuer/acquirer. The Finalise amount can be different to the original Pre-Auth amount, but merchants should note that if the Finalise amount is higher, there is no guarantee that the bank will approve the higher amount. Merchants should contact the appropriate bank or issuer/acquirer for further information on Pre-Auth eligibility and fund holding timeframes.
Please note the following. Eligible merchants can reduce their chances of fraud and theft by using Pre-Auth/Finalise. Merchants must request Pre-Auth (Hospitality) functionality from their Merchant Bank before it can be enabled on their EFTPOS terminal. Pre-Auth transactions can be performed using Credit Cards only; they cannot be done with Debit Cards (i.e. Visa Debit). A Pre-Auth does not move funds and any service should not be deemed to be paid for by either the customer or the merchant by an approved Pre-Auth transaction. Pre-Auth funds are not settled and will not show in the merchants bank account until the transaction has been Finalised. Merchants MUST retain their Pre-Auth EFTPOS receipts as proof of transaction. Merchants should complete all Pre-Auth transactions by processing a Finalise transaction and not by initiating a new Purchase transaction. Un-required Pre-Auths must be completed (Finalised) for a zero dollar amount. If a customer decides to pay in full by cash (or other means) the merchant must process a Finalise of the Pre-Auth immediately for zero value and provide the Finalise receipt copy to the customer. Pre-Auth can be used with our Currency Select EFTPOS feature; however the merchant should be aware that Finalising on a different day will offer FX rates at the current day’s rate, which may be higher or lower than the day of the original Pre-Auth. Customers whose credit cards have been pre-authorised can check details with their respective credit card bank to confirm their understanding of pre-authorisation terms and conditions.
If you would like to set up Pre-Auth on your terminal, please contact one of our customer service representatives on 0800 4 SMARTPAY (476 278).