Incremental Authorization (Incremental Auth)
Incremental Authorization allows increasing the amount held by a prior Authorization (Auth) through multiple separate requests within the same order, without creating a new Auth from scratch. This method is used by merchants whose final transaction amount is unknown at the start and may change while the order is being fulfilled. Incremental Auth guarantees sufficient funds are held on the payer's account before the final charge (Capture), reducing the risk of a failed transaction due to insufficient funds.
Features:
- An incremental authorization can be created only if the original Auth was successful.
- There is no limit on the number of Incremental Auths that can be created for a single order.
- An Incremental Auth is not created if any previous Incremental Auths for the payment have not yet reached a final status, or if a successful Capture or Void has already been performed for the order.
Incremental Auth use-case:
- When a customer fills out their cart in an online shop and completes a payment, the payment amount is authorized and temporarily held on their card.
- The merchant checks whether the product is in stock. However, only a more expensive alternative is available, so the merchant contacts the customer:
- If the customer agrees to the alternative product, the merchant authorizes the difference in amount through incremental authorization and captures the authorized amount for the final product price. The funds held under both authorizations are then captured.
- If the customer declines, the merchant voids the payment, causing the held funds to become available to the customer. In such cases, there is no need for the merchant to issue a refund or incur any additional fees.