In payments, “Capture Only” refers to a transaction processing mode where the merchant captures the necessary information to initiate a payment transaction without immediately requesting authorization or settlement. It is commonly used in situations where the merchant needs to gather payment details upfront but wants to delay the authorization and settlement process until a later time. Here’s how Capture Only works:
- Information Collection: When a merchant chooses the Capture Only mode, they collect the necessary payment information from the customer, such as credit card details or other payment credentials. This can be done through various channels, including in-person transactions, online forms, or over the phone.
- Authorization Delay: Unlike the typical payment process, where authorization occurs immediately after information collection, Capture Only postpones the authorization step. Instead, the payment information is securely stored by the merchant or their payment processor for future processing.
- Authorization and Settlement: At a later time, when the merchant is ready to proceed with the transaction, they initiate the authorization request. The payment processor or acquiring bank then verifies the payment details, checks for available funds, and authorizes the transaction.
- Settlement: Following the authorization, the settlement process occurs, where the payment processor transfers the funds from the customer’s account to the merchant’s account. This typically involves the payment processor forwarding the authorized transaction to the card networks, which in turn communicates with the customer’s issuing bank to transfer the funds.
Capture Only offers several advantages and use cases:
- Pre-Authorization: Merchants can collect payment information in advance, allowing them to reserve the desired amount on the customer’s card without actually completing the transaction. This is useful in situations where the final transaction amount may vary (e.g., hotel reservations, rental bookings).
- Delayed Charging: Capture Only enables merchants to delay charging the customer until a later date or when the goods or services are ready to be delivered. This is common in industries where the fulfillment of orders occurs after a certain processing time (e.g., e-commerce pre-orders).
- Enhanced Customer Experience: Capture Only provides flexibility for merchants to confirm the availability of products or services before fully charging the customer. It helps reduce the risk of refunds or disputes caused by unexpected out-of-stock items or service unavailability.
It’s important to note that the specific implementation of Capture Only and the supported timeframes for capturing authorization may vary depending on the payment processor, acquiring bank, or merchant’s agreement. Merchants should consult their payment service provider or refer to the documentation provided to understand the specific details and procedures related to the Capture Only mode.