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Everyday money

What actually happens in the two seconds after you tap a card

Authorisation, capture, settlement and the pending amount that does not match your receipt. A short tour of the plumbing.

Ada OkonjoHead of Savings6 minute read

You tap, the terminal beeps, your phone buzzes. Between those two things sits a chain of messages that explains almost every card question we are ever asked — including why a payment can be pending for days, and why the amount sometimes changes.

Authorisation: a question, not a payment

The terminal asks whether the money is there and whether the card is allowed to spend it. We check the available balance, the limits you have set, and our fraud rules, and we answer within a couple of hundred milliseconds. If the answer is yes, we place a hold on that amount.

A hold is not a payment. Your ledger balance has not changed. Your available balance has, which is why the two figures can differ.

Capture: the merchant claims it

The merchant later tells the network what to actually collect. For a shop that is usually the same evening and the same amount. For a hotel, a car hire firm or a fuel pump it might be days later, and it might differ from the authorisation.

Settlement: the money moves

Overnight, the networks net off everything owed between banks and move the funds. This is when the transaction stops being pending and becomes a settled line on your statement, with a final amount.

What to do with the knowledge

  • A pending amount that does not match your receipt is normal and will correct at settlement.
  • A hold that has not cleared after seven days has expired on our side; the money is yours again.
  • A refund is a new transaction travelling in the other direction, not a reversal, which is why it takes as long as a payment.
  • Freezing your card blocks new authorisations immediately, but does not stop a capture that has already been authorised.
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Banking that agrees with itself

Every figure on this site comes from the same catalogue the bank runs on. Open an account in about five minutes.