FinTech Glossary

Meaning

An authorization hold is a temporary block placed on a portion of funds in a cardholder's account when a transaction is initiated, reserving the amount until the merchant settles the final transaction or the hold expires.

Business Context

Authorization holds are common in card-based corporate spending, hotel bookings, fuel purchases, and subscription services, where the final billed amount may differ from the initial estimate.

How It Works

When a card is swiped or used online, the issuing bank verifies available funds or credit limit and places a hold for the estimated amount. The hold is released, adjusted, or converted into an actual debit once the merchant submits the final settlement, typically within a few days.

How EnKash Helps Track Authorization Holds

EnKash corporate cards give finance teams real-time visibility into authorization holds versus settled transactions, helping avoid confusion during reconciliation and ensuring accurate, up-to-date spend tracking.