# Pre-Authorization

A pre-authorization is the reservation of an amount in the form of a payment guarantee. The amount is not charged to the card but merely reserved and held for a predefined period of time.

## Payment Guarantee for the Merchant

A pre-authorization provides the merchant with the assurance that sufficient funds are available on the customer’s card. Since the customer cannot access the reserved amount during the pre-authorization period, it serves as a payment guarantee for the merchant.

{% hint style="info" %}
The maximum amount that can be reserved depends on the card issuer.
{% endhint %}

The actual charge only occurs once the merchant provides the service. Depending on the use case, the merchant can charge either the full reserved amount or only part of it.

### Expiration of pre-authorizations

If the reserved amount is not captured, the pre-authorization will automatically expire after 7 to 30 days. The exact timeframe is determined by the card networks or the card-issuing bank and may also depend on the merchant’s industry.

{% hint style="info" %}
Payrexx does not know the specific expiration period and therefore has no influence over it.
{% endhint %}

## Use Cases for Pre-Authorizations

Pre-authorizations are often used in industries where the final amount of a service can only be determined at a later stage. Common examples include [hotels](#hotels) and [car rental companies](#car-rentals).

### Hotels

Pre-authorizations are commonly used in hotels. Pre-authorized payments allow funds to be reserved either during the booking phase or at check-in. By reserving an amount, it ensures that a guest does not leave without paying and covers additional costs such as minibar or spa services.

#### Example

* A guest books a hotel room for EUR 200.00.
* At check-in, the hotel reserves EUR 300.00 on the guest’s card.
* The guest consumes EUR 30.00 from the minibar.
* The hotel charges EUR 230.00 to the guest’s card and releases the pre-authorization.

### Car rental companies

Car rental companies also commonly use pre-authorizations. By reserving funds when the vehicle is picked up, they can ensure that the car is returned in the agreed condition and with a full tank, or that any resulting costs can be covered if this is not the case.

## Integration

Pre-authorizations can be used in Payrexx in two ways:

* via [Payrexx tools](#via-payrexx-tools)
* via [API or Gateway](#via-api-or-gateway)

### Via Payrexx tools

To use pre-authorizations via the [Payrexx tools](/merchant/english/account/tools.md), you must first set up a payment provider that supports pre-authorizations. You can find out which providers support this functionality in the following article:

{% content-ref url="/pages/-M\_5q7zPuSWKL65zOh5k" %}
[Payment Provider Feature Matrix](/merchant/english/payment-provider/psp-features.md)
{% endcontent-ref %}

Afterwards, you can use pre-authorizations in the following tools:

* [Pages](/merchant/english/account/tools/pages.md)
* [Paylink](/merchant/english/account/tools/paylink.md)
* [Terminal](/merchant/english/account/tools/terminal.md)

Instructions on how to create pre-authorizations and capture amounts can be found in the following article:

{% content-ref url="/pages/uj7U48IAuxmdLgHQnfxX" %}
[Pre-Authorizations](/merchant/english/account/payments/pre-authorizations.md)
{% endcontent-ref %}

### Via API or Gateway

Information and instructions for implementing pre-authorization as a payment method via API or Gateway can be found in our developer documentation:

{% embed url="<https://docs.payrexx.com/developer/guides/gateway/payment-types/pre-authorization>" %}


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