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Authorise a POS transaction

Verify and reserve funds for secure POS transactions.

Authorisation is the process of confirming the validity of a customer’s credit card and reserving the transaction amount before completing a sale. This step ensures that funds are available and provides you and the customer security during the transaction.

There are two types of authorisation – final authorisation and pre-authorisation.

  • Authorisation
    • Confirms the credit card’s validity and reserves the intended amount on the card.
    • The payment gateway automatically sends the authorised amount for capture at the end of the day.
    • During the period between authorisation and capture, the reserved amount reduces the customer’s available credit limit.
    • See Capture for more details.
  • Pre-authorisation
    • Used for transactions where the final amount is determined later, such as car rentals, hotel bookings, and fuel purchases.
    • Authenticates the card and cardholder while verifying the availability of funds.
    • Requests approval for an estimated amount, which will be adjusted when the final amount is known.
    • Common for services where payment is taken before the transaction is finalised.

Authorisation transaction workflow

The authorisation process can be initiated at a POS terminal or through EPOS integration. Below is the workflow:

  1. Initiate Transaction
    2. The cashier rings up the items and provides the total amount to the customer.
  2. Card Interaction
    3. The customer inserts, swipes, or taps their card on the POS terminal.
  3. Wait for Authorization
    4. The terminal reads the customer’s card information using a chip, magnetic stripe, or RFID technology for contactless payments.
  4. Enter PIN
    5. The customer enters their Personal Identification Number (PIN) using the terminal keypad. For contactless payments, PIN entry may be required for transactions above a certain limit.
  5. Wait for Approval
    6. The terminal processes the transaction and requests approval from the customer’s bank.
  6. Transaction Approval
    7. If the PIN is correct and sufficient funds are available, the bank reserves the specified amount. A confirmation message is displayed on the terminal.
  7. Remove Card
    8. The terminal prompts the customer to remove their card.
  8. Receipt Option
    9. The customer can choose to receive a printed receipt or have it emailed.
  9. Complete Transaction
    10. After receiving their card and receipt, the customer completes the purchase, and the cashier provides the items.

Based on the authorisation response, you can choose to proceed with a capture transaction to initiate the funds settlement, or you can void the authorisation if the customer decides not to proceed with the purchase.

Pre-authorisations

Pre-authorisations help you obtain approval for an estimated transaction amount. They are especially useful when the final transaction amount is uncertain, such as car rentals, hotel reservations, or fuel purchases. Pre-authorisations have two main functions – they validate the credit card and the cardholder, and they confirm the availability of funds.

Pre-authorisations share similarities with final authorisations but they differ in their extended authorisation timeframe and the ability to adjust the transaction amount within specific limits defined by the card scheme.

To initiate a pre-authorisation, you must select the payment method on the POS or EPOS integration.

Card scheme-specific pre-authorisation details

Here are the specific pre-authorisation details for each card scheme:

Visa

MCC Restriction Visa does not impose specific restrictions on the Merchant Category Code (MCC) for pre-authorisation.
Authorisation timeframe The maximum authorisation timeframe for Visa pre-authorisations is 30 days.
Authorisation timeframe extension Visa does not allow to extend the validity period of a pre-authorisation with an Incremental Authorisation
MCC SEGMENT AUTHORISATION TIMEFRAME
3501-3999, 7011 Lodging 31 days
3351-3500, 7512 Car rental 31 days
4411 Steamship and cruise lines 31 days
7513 Truck rentals 7 days
7033 Trailer parks and campgrounds 7 days
7519 Motor home and recreational vehicle rentals 7 days
5552 Electric vehicle charging 7 days
7523 Parking and garages 7 days
7394 Equipment, tool, furniture, and appliance rental 7 days
7999 Recreation services 7 days
7996 Amusement parks, carnivals, circuses, fortune tellers 7 days
5599 Miscellaneous automotive, aircraft, and farm equipment dealers 7 days
4457 Boat rentals and leasing 7 days
5571 Motorcycle shops and dealers 7 days
4111 Local and suburban commuter, and passenger transportation, including ferries 7 days1
4112 Passenger railways 7 days1
4131 Bus lines 7 days1
5812 Eating places and restaurants end of approval day2
5813 Drinking places, bars, taverns, cocktail lounges, nightclubs, discotheques end of approval day2
4121 Taxicabs and limousines (card-absent environment only) end of approval day2
7 days1 The maximum authorisation timeframe is 7 days. For US merchant regions, this timeframe is 3 days.
end of approval day2 The authorisation timeframe lasts until the end of the approval day in the acquirer’s timezone.
25 USD3 A capture with an amount of up to 25 USD can be requested without the need for additional incremental authorisation. In cases where the authorised amount is less than 25 USD (15 USD for US region merchants), the corresponding amount will be converted to the transaction currency if it differs from USD.

Mastercard

MCC Restriction Mastercard does not impose specific restrictions on the Merchant Category Code (MCC) for pre-authorisation.
Authorisation timeframe The maximum authorization timeframe for Mastercard pre-authorisations is 30 days.
Authorisation timeframe extension Mastercard supports authorisation timeframe extensions through the Incremental Authorise feature.
MCC Segment Authorisation timeframe
5812 Eating Places, restaurants 30 days
5814 Fast food restaurants 30 days

Maestro

MCC restriction Maestro does not impose specific restrictions on the Merchant Category Code (MCC) for pre-authorisation.
Authorisation timeframe The maximum authorisation timeframe for Maestro pre-authorisations is 7 days.
Authorisation timeframe extension Pre-authorisations are not allowed for Maestro POS transactions, except for automated fuel dispensers, electric vehicle charging, and contactless transit transactions.
MCC Segment Authorisation timeframe
5812 Eating Places, restaurants 7 days
5814 Fast food restaurants 7 days