Debit Card Authorization Holds
Your account’s available balance can be impacted by debit card pre-authorization holds for "credit"
or “signature” transactions. This does not include PIN-based or "debit" transactions. These holds
appear as pending transactions in online banking and are reflected in your available balance allowing you to
determine the amount of available funds so that you can avoid NSF and Overdraft Privilege fees.
We've included some Frequently Asked Questions below, but if you want to know more give us a call at (801)
What is a debit card authorization hold?
When you use your debit card to conduct a Signature or “Credit” transaction (i.e., you do not enter your PIN),
the merchant sends the Credit Union the amount, usually the purchase total, for authorization. This amount is
placed on hold and removed from your available balance immediately. The hold is released after approximately 72
hours or when the transaction clears, whichever comes first. The hold helps determine the available balance on
Will debit card authorization holds apply to all my purchases?
No, debit card authorization holds only apply to debit card transactions when you sign your name or do not
enter a PIN. For example, a debit card purchase made at a restaurant or with an online merchant would be treated
as a Signature/Credit transaction and would be subject to an authorization hold.
Debit purchases and ATM withdrawals made using a PIN subtract the funds immediately from your account (except
for when you use your PIN at a gas station).
What is the difference between my current balance and my available balance?
Your available balance reflects any authorization holds or deposit holds and is used by the Credit Union to
determine available funds when transactions attempt to clear your account. The current balance the Credit Union
uses as transactions clear is called your available balance and includes all items that have cleared your
account up to that point and reflects any items on hold. If your available balance is not sufficient to cover a
transaction, the Credit Union may pay the item and charge you a Overdraft Privilege fee. A Overdraft Privilege
fee may be charged even though your current balance indicates a positive amount.
LEARN MORE ABOUT AVAILABLE BALANCE
Why does the Credit Union utilize debit card authorization holds?
Using debit card authorization holds helps you better determine the funds you have available for use. This
information will help you avoid non-sufficient funds (NSF) or overdraft situations. For example, if you review
your account online and see that your available balance is $100, you may decide to spend only $60 at a merchant.
Your current balance may be $200 but $100 is on hold from a Signature/Credit transaction that you made earlier
in the day. If the debit card authorization hold for $100 was not on hold, your available balance would appear
to be $200 and you may have spent an amount (above $100) that would place the account in an overdraft situation
when your earlier transaction posted to the account.
Does the Credit Union utilize debit card authorization holds to generate more Overdraft Privilege
No. Debit card authorization holds are utilized so that you can check your available balance and obtain a more
accurate picture of the funds that are available for you to spend.
Will the debit card authorization hold always equal the exact amount of my transaction?
No. Some merchants, especially gas stations, hotels and sometimes restaurants, will pre-authorize an amount
that is higher or lower than the actual purchase amount. For example, gas stations pre-authorize transactions
for amounts ranging from $1 to $100 because they do not know how much gas you will actually pump in advance of
your transaction. If they pre-authorize $75, the Credit Union will place a hold for $75 even if your actual
transaction is only $45.
How can I reduce the impact of debit card authorization holds?
You can use your debit card and select “Debit” and enter your PIN. Or, if you are unable to conduct a PIN/Debit
transaction, you can use your Credit Union credit card to conduct the transaction and avoid the debit card
What is a gas station or fuel hold? How does this differ by transaction type?
For Signature/Credit transactions, a $1 authorization is processed to check your card, followed by the
finalization of fuel pumped for the full amount which posts to your account. Once the finalization is posted the
$1 hold drops. VISA requires the hold to be released within three (3) business days.
For PIN/Debit transactions, merchants determine the dollar amount of funds held. VISA allows up to $100, most
merchants add $50 to $85, but the amount changes at the merchant’s discretion due to fuel costs and larger tanks
on vehicles. Most merchants post signs at the pump stating their practice. VISA allows merchants a maximum of
two (2) hours for sending the finalization of the PIN/Debit transaction. When the finalization posts, the hold
is removed from your account.
What is a travel hold?
When you use your debit card to make reservations in advance, hotels generally will pre-authorize an amount
equal to an overnight stay, or more, depending on the length of your stay. This will result in a hold on your
account for up to 72 hours. When you actually arrive, the hotel will place another pre-authorization, often
larger than the cost of your stay to cover possible incidental expenses.
The authorized amounts will vary based on VISA maximum limits and the merchant should have a disclosure that
informs you of the hold. These holds will not be removed until the finalization comes through or after a maximum
of five (5) days.
One way that you can avoid these large holds is by using your Credit Union credit card for these types of
transactions. Just be sure to pay down your credit card balance using the funds from your checking account.
When I make a purchase online or by phone using my debit card, is it processed as a credit or debit
Online and telephone debit card transactions are generally processed as Signature/Credit transactions because
you do not have the option to enter your PIN. These types of transactions will create an authorization hold.
If the Credit Union places a hold on my account and then the transaction posts, is there a chance the
Credit Union will subtract the amount from my available balance twice?
When merchants pre-authorize an amount that is different from the final transaction total, there is a chance
that the hold and the transaction will not match and the hold will not release. If the transaction does not
match the hold, the hold will be automatically released in 72 hours.
Do all debit card transactions clear within 72 hours?
No. Some merchants will not send the final transaction to the Credit Union within the 72 hour timeframe of the
hold. In these situations, the hold will drop off and the funds will appear to be available again, however, the
transaction still has to post to your account. Unfortunately, the Credit Union has no control over how quickly
merchants process their transactions.
The best way to know the amount of funds you have available for use is to carefully track all of your
transactions (including checks, automatic payments, deposits and debit card transactions).
Can debit card authorization holds on my account be removed?
It is not the Credit Union’s policy to remove debit card authorization holds unless an error was made. If an
erroneous hold was placed or there are extenuating circumstances that may warrant removing the hold, please
contact the Credit Union.
Does the Credit Union offer Overdraft Protection options?
Yes. Available funds can be pulled automatically from your Primary Savings to cover the transaction. Or, you
can establish an Overdraft Line of Credit* that automatically transfers the funds if you do not have sufficient
available funds to cover a transaction. If you do not have sufficient available funds in either your Primary
Savings account or Overdraft Line of Credit, the transaction may be covered by the Credit Union’s Overdraft
LEARN MORE ABOUT OVERDRAFT SERVICES
* The Overdraft Line of Credit option requires a loan application to determine eligibility.
LEARN MORE ABOUT OVERDRAFT LINE OF CREDIT