Delayed Capture

Delayed capture, also known as capture later, is a transaction processing strategy used by merchants who cannot immediately deliver goods or services at the time of the initial credit card authorization. This method is especially common in the e-commerce sector, where there may be a lag between when a purchase is authorized and when it is actually shipped or delivered.

The process involves two main steps:

Delayed capture is beneficial because it allows merchants to ensure they do not charge customers until the goods are on their way or the service is ready to be rendered. This can improve customer satisfaction by aligning charges with the receipt of value. It also protects merchants by not committing to a full transaction until they are certain they can fulfill the order, thereby reducing the risk of chargebacks associated with cancellations or unfulfilled orders.

However, it is important for merchants using delayed capture to be aware that authorizations typically have a time limit—often several days, depending on the card issuer—after which the authorization can expire if not captured. Merchants need to ensure they capture the authorized funds within this period to avoid the need to re-authorize and potentially lose a sale if the customer no longer has sufficient funds available.