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What is an authorized payment?

An authorized payment is an electronic payment in which money is withdrawn from a customer’s bank account and deposited into a business bank account. This type of payment refers to the arranged payment agreement held between a business (payee) and a customer (payer). 

In the agreement, the payer provides bank details for access to withdraw funds. On the day the authorized debit is scheduled for processing (when the order status is "Fulfilled") or the moment the payee decides to manually request a capture of the payment, the funds are withdrawn from the payer's bank account. Funds are settled into the recipient's bank account a few business days later.

Learn about the benefits of authorized payments in the following blog article

What kind of businesses can benefit from this type of payment?

  • Businesses that use units of measurement and sell products in bulk (vegetables, fruits, cereals, cosmetics, etc.). With authorized payments, you'll be able to charge your customers exactly what they received. If a customer ordered 5 kg of potatoes and 5 kg of apples, but when processing the order and measuring the products, it turns out 4.80 kg of potatoes and 4.70 kg. apples, you will be able to withdraw the exact amount of the blocked debit and the customer will get the rest back.
  • All businesses that sell fashion, cosmetics, accessories, sporting goods, electronics, children's goods, home goods, and many more can benefit from the option of authorized payments. In this way, you can save fees that are charged when an order is canceled and the amount should be refunded by bank transfer. In addition, accounting operations such as issuing/canceling invoices, credit memos, etc. will be minimized.

Ex: A customer makes a purchase of a jacket and shoes, and you fulfill the order while the order amount remains blocked on his card. You wait for the 14-day statutory return period to ensure the customer will keep the items, then you manually capture the payment from the appropriate button and the amount goes into your account. 

The pre-authorized debit cannot be accessed by the customer under any circumstances, so you have a secure payment that you can capture at any time, either automatically when the order is fulfilled or after a certain period manually, for example right after the expiration period for returning the goods.

Note that you cannot take out more than the amount that is authorized by the customer. When processing the order, it is important that the final value of the goods is equal to or less than the blocked amount on the customer's account. The software will not allow you to execute the order if it is at a higher value than the original one. 

If the order costs EUR 100, but during processing, it turns out that the products are worth less than this amount (EUR 95), especially in cases where you sell goods in bulk - fruits, vegetables, rice or, when a given product is no longer available, then you will deduct this EUR 95, and the remaining amount will be released and the customer will receive it back. This way, the customer is satisfied that has been charged only for what he has received, and you won't have to compensate him with vouchers, credits, etc. 

Security of payment

Increase customer confidence in making card payments online by accepting authorized payments. This type of payment provides maximum security for both merchants and customers. 

The service is avaivable for both credit and debit cards. 

How to activate authorized payments?

To start accepting this kind of payment in your store, it is necessary to contact your servicing bank and state that you wish to activate the option for authorized payments. 

This functionality** is only valid for certain payment providers. In your admin panel, go to the setting page of the payment method you use, and look for the option for authorized payment*.

*Currently, this type of payment is offered by DSK and Borica.

**The option is only active for Enterprise and Enterprise Plus subscription plan merchant.

The service does not work with cards issued Borica, Maestro, Diners Clu.

In the admin panel, the "authorize payment" section looks like this: 

  • Automatic capture - in this method, after the merchant processes the order and marks it as fulfilled, the corresponding amount will be captured from the customer's account. 
  • Manual capture - in this method, the store administrator himself decides at what moment to deduct the amount from the customer's account. 

 The order payment status is "Pending" and will remain so until it is captured manually or automatically. 

If no action is taken by the merchant, each authorized payment has a statute of limitations (standard 30 days) according to the card operators' documentation, after which it is released.

If you as a merchant cannot fulfill the customer's order for any reason, you must release the withheld amount by canceling the authorization from the corresponding button.

Order filtering

In the "Orders" section, a new type of filter has been added, with which you can filter all orders whose payment status is "authorized" and the amount is not "captured" and take appropriate actions. 

More information about working with filters can be found here.