Important Update on Credit Card Payment Processing

Important Update on Credit Card Payment Processing

We recently released a significant update regarding the processing of credit card payments. Previously, the process involved authorizing the guest's funds, posting the authorization on the folio, and finally completing the batch settlement, where funds are transferred from the client to the hotel.
 
We have strengthened this process by introducing a new step called "Capture," which occurs between the authorization and the batch settlement. This step ensures that the amount is held when it is posted on the folio (or as an advance deposit).
 
To simplify:
- Authorization: Confirms the funds are available and places a hold on them. No money moves at this stage.
- Capture: Once a payment is posted to the folio (or as an advance deposit), the PMS captures the authorized amount. This blocks the funds, meaning they’re now set aside for the hotel but still haven't been transferred.
- Batch Settlement: At the end of the day, during the batch settlement process, the funds from all captured transactions are transferred from the guest’s account to the hotel’s account.

This also means that once a credit card payment is posted (either as an advance deposit or on a folio), it cannot be adjusted, overridden, or voided.
 
You can find more information in this article..
 
 
Of course, for debit cards, when an authorization is made, the bank may place an immediate hold on the funds in the guest's bank account. This reduces the guest's available balance, even though the money hasn’t officially been transferred. While it seems like a charge, the actual movement of funds only happens when the payment is captured in the system, similar to how it works with credit cards. Until that capture, the authorization is still just a hold.
The key difference with debit cards is that the guest may see the funds as unavailable even before the charge is finalized.