Credit Card Authorize vs Capture

While many businesses will want to take payment immediately online, sometimes the business model requires that the customer’s card be authorized but not charged until the goods have been shipped.

Most gateways allow you to authorize only for the payment, and then within a week capture the payment when you ship the goods. The length of time allowed before capture depends on the contract you have with the Gateway (based on their rules, and on the kind of business you run).

Authorize-Only

To enable this, check whether your module has an option to specify Authorize-Only mode, and enable it. (As opposed to Charge or Capture mode.)

The process is this:

1. Customer places an order. The card is only authorized.
2. Prepare the order
3. Log in to your Merchant Gateway system. Find the transaction for that customer/order.
4. Choose the option to Capture the funds. This charges the card and puts the money in your bank account during the next settlement/processing batch.
5. Ship the goods

If you set your payment module to Authorize-Only, be sure to set the Order Status to Pending, just like an offline payment module.

Authorize And Capture Immediately

The process is this:

1. Customer places an order and submits for payment. The card is authorized and funds captured immediately.
2. You fulfill the order by shipping the goods (or customer gets immediate access to their downloads).