Virtual terminal, authorizations process

Kiriakos1977
New Community Member

We use virtual terminal to authorize advanced bookings in our health treatments business. After the appointment the customer can instruct us to complete the payment through PayPal or they can pay with a credit card or cash, in the latter scenario we will cancel the PayPal authorization.

 

In some instances after the authorization process the customer will receive notification from their bank that money has left their account, which is contrary to what we have been saying to the customer, i.e. that they are not making any payment at the time of the authorization. Our understanding of the process is that PayPal freezes the payment money on the account but it does not withdraw any money from the account, only when we get permission from the customer and "capture" the amount of money, funds will leave the customer’s account

 

As you can understand this is putting us in quite a difficult position when trying to explain what has occurred in these cases

 

On the latest incident we had the customer is still waiting since the 11th of Nov ( cancelation of the authorization) a refund from PayPal on their bank account 

 

Please advise on how the process works and what we are supposed to communicate to customers

 

Thank you

Login to Me Too
1 REPLY 1

PayPal_paula
Moderator
Moderator

Hi Kiriakos1977, 

 

If you are using the order and authorisation option on PayPal, the funds are not requested by PayPal until they are captured by you, the merchant. 

 

What can happen depending on the bank is that when the authorisation is placed to see if the funds are available the customers bank place the funds in to a holding account or pending balance to wait for PayPal to take them. If we do not request them or the order is cancelled we will not request the funds. After a certain timeframe depending on the bank the funds will be put back in to the customers bank account. This is not something that PayPal control as when the authorisation is placed we are just looking to see if the funds are available we are not requesting them to be put in a pending balance however some banks system work differently. 

 

I hope this helps answer your questions

Paula 

Login to Me Too

Haven't Found your Answer?

It happens. Hit the "Login to Ask the community" button to create a question for the PayPal community.