What is Partial Authorization Mandate?

What is Partial Authorization Mandate?
4 min read

A partial authorization mandate is a payment authorization request that allows merchants to charge only a portion of a customer's credit or debit card balance. This can be useful in situations where a customer does not have sufficient funds available to cover the full cost of a purchase, or where the merchant wants to charge the customer in installments. Partial authorization mandates can be used for both physical and online transactions.

In order to process a partial authorization mandate, the merchant must first obtain the customer's consent and then submit the request to the customer's card issuer or payment processor. If the request is approved, the issuer or processor will authorize the charge and the funds will be transferred from the customer's account to the merchant's account.

There are a few different ways that merchants can use partial authorization mandates, depending on their business needs and the policies of their payment processors. For example, a merchant might use a partial authorization mandate to charge a customer's card in installments over time, or to charge the customer's card for a deposit or down payment and then charge the remaining balance at a later date.

It's worth noting that partial authorization mandates are not always approved, and that the terms and conditions for their use may vary depending on the merchant's payment processor and the customer's card issuer.

How to set up a partial authorization mandate?

To set up a partial authorization mandate, merchants will need to follow these steps:

  1. Obtain the customer's consent: Before charging a customer's card for a partial amount, the merchant must obtain the customer's consent to do so. This can be done through a written agreement or by obtaining the customer's verbal consent.
  2. Contact the payment processor: In order to process a partial authorization mandate, the merchant must contact their payment processor and request that the partial charge be authorized. The merchant will need to provide the payment processor with the customer's card information, the amount to be charged, and any other relevant details.
  3. Wait for approval: The payment processor will review the request and decide whether or not to approve the partial authorization mandate. If the request is approved, the payment processor will authorize the charge and the funds will be transferred from the customer's account to the merchant's account.
  4. Charge the customer's card: Once the partial authorization mandate has been approved, the merchant can charge the customer's card for the authorized amount. The merchant should keep a record of the transaction, including the customer's consent and the approval from the payment processor.

It's worth noting that the process for setting up a partial authorization mandate may vary depending on the merchant's payment processor and the policies of the customer's card issuer. Some payment processors may have specific requirements or procedures that merchants must follow in order to request a partial authorization mandate.

What types of cards will partial authorization?

Partial authorization mandates are typically available for credit and debit cards that are issued by major card networks, such as Visa, Mastercard, American Express, and Discover. However, the availability of partial authorization mandates may vary depending on the policies of the card issuer and the merchant's payment processor.

Some card issuers and payment processors may have restrictions on the types of transactions that are eligible for partial authorization, or they may only allow partial authorization mandates for certain types of merchants or industries. For example, a card issuer may only allow partial authorization mandates for online transactions, or a payment processor may only allow partial authorization mandates for physical goods and services.

It's important for merchants to check with their payment processor and the customer's card issuer to determine whether partial authorization mandates are available and what the specific terms and conditions are for their use.

In case you have found a mistake in the text, please send a message to the author by selecting the mistake and pressing Ctrl-Enter.
Comments (0)

    No comments yet

You must be logged in to comment.

Sign In / Sign Up