Payments & settlement · Trade
Pre-authorization
Also called pre-auth, card authorization, hold
The short answerA temporary block on your card for an amount the merchant may charge later; money is set aside, not taken.
What it means
A pre-authorization asks your card issuer to set aside an amount for a merchant. The money stays in your account but you can't spend it while the hold is active. In car rental, it's how the security deposit is usually taken. When the rental closes, the rental company charges what's owed and releases the rest.
Why it matters
Your bank controls how quickly a released hold disappears, which is why a deposit can still show for days after you return the car.
Related terms
- Security depositAn amount the rental company holds on your card at pickup and releases after the car comes back without new charges.
- Debit card restrictionLimits many rental companies place on using a debit card, especially for the security deposit.
Also related Authorization, Capture, Card hold release