Authorization

Authorization is the first step in processing a credit card payment. It verifies that the customer's card is valid and has sufficient funds (or credit) to cover the transaction.

During authorization, an electronic request is sent through the payment gateway to the acquirer, then to the card network, and finally to the issuing bank. The issuer responds with an approval or decline code.

Once authorized, the funds are temporarily "held" on the customer's account, reducing their available balance, but the money is not yet transferred to the merchant until the Capture occurs.