What is a credit card authorisation and why is it important?

If you have started using a credit card recently, you may have faced a situation wherein a merchant tried to authorise your card to verify whether it has sufficient funds or not. It is a temporary hold placed on a certain amount of a customer’s credit card to confirm that they have sufficient funds or credit available to complete a purchase. Lifetime free Credit Card No credit score required Check Eligibility This process is imperative for both merchants as well as consumers, thus ensuring a safe and secure transaction between the two parties. Issuer Verification: The issuer checks the cardholder's account balance, credit limit, and any fraud alerts Sending the code: Following this, the card issuer sends an authorisation code to the merchant. Credit card authorisation is vital for these reasons: Verification of funds: The card authorisation ensures that the cardholder has enough credit available to complete the transaction, which helps reduce declined transactions at checkout.