• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Money Management
    • Debt Reduction
    • Credit
    • Mortgages
    • Mutual Funds
    • Tax Strategies
    • Loans
  • Budgets
    • Saving Money
    • Income
  • Banking
    • Checking Accounts
    • Check Writing
    • Fraud
    • History
  • Entrepreneurs
    • Entrepreneur Interviews
    • Money Making Ideas
    • 3D Printing
  • Resources
  • Retirement
  • About
    • Privacy Policy

Personal Finance Blog

Tips And Stories To Help You With Managing Money

  • Privacy Policy
  • Saving Money In 2018
You are here: Home / Money Management / Debit Cards / Debit Card Pre-Authorization Holds

Debit Card Pre-Authorization Holds

February 3, 2014 By Twila Van Leer

You insert your debit card. You pump the gas. You cringe (the current average price- per-gallon for premium is $3.62) and you leave the filling station assuming the $40 total will be subtracted from the balance in your debit card account. Simple, right?

What you don’t know is that behind the scenes, computers are doing their thing and when they are done, your bank may have put a pre-authorized hold on your account. It may be larger than your actual balance, especially if you are chronically hovering about the edges of the account. That means that when you drive from the gas station to the grocery store, your $15 purchase there may not be covered by the debit account.

For example, this made-up scenario: You have $100 in your account balance. You purchase $80 worth of merchandise or services (restaurants and hotels may also use this approach, as well as gas stations). The bank puts a pre-authorization hold on your account for $80. So the $20 you thought you had in the account is not available and additional use of the card will not be honored, which could mean additional fees.  Some credit card users have found themselves in serious trouble with overdrafts, not to mention the embarrassment and inconvenience involved.

In essence, your “available” balance and your “actual” balance can be two different figures.  The amount of the hold is deducted from your accounts “available” balance but not from the “actual” balance until the transaction that triggered the hold is processed, which could be several days.  Paying attention to your  “available” balance will help, but given the time frames involved, may not always provide the needed information as quickly as necessary.

“I don’t think the average customer has any idea what goes on behind the scenes when they swipe a card,” said Jeff Lenard, vice president of communications for the National Association of Convenience Stores (which sell about 80 percent of the gasoline purchased in the United States each year.)  “The credit and debit card system is incredibly complex.”

The problems associated with pre-authorized holds are only part of the potential trouble with using cards for gas station transactions.  Financial gurus also point out that the stations are a “danger zone” for theft of card data for fraudulent uses. Julie McNellely, senior analyst for Aite Group, a Boston-based financial services research organization, describes how bad guys bent on fraud use the stations to achieve their ends.

While customers are using their debit cards to make purchases at the pump, a thief sitting in a car nearby, armed with a laptop, a pinpoint camera and an antenna, has skimmed off the vital information from the card, including, if the camera is able to get a good view, the PIN. Before the unwary customer has even arrived at home, the information may have been put to fraudulent use.

Experts familiar with the potential for fraud at the gas station suggest the use of cash or credit cards, rather than debit cards, when filling up.

Related Posts

  • Debit Cards

    Debit cards are used by millions of people in this era. A debit card is…

  • Debit Cards

    [ad#250x250]Debit cards are gaining popularity these days, primarily due to the recession. People are trying…

  • Debit card fraud

    If you are like millions of people, you use a debit card to make your…

Filed Under: Debit Cards Tagged With: debit cards

Primary Sidebar

Personal Finance Articles

  • Make Saving A Priority
  • Review Your Home-Insurance Risks
  • Lowest Air Fare? Try August 28
  • Hackers Targeting Bitcoins
  • Keep Your Emergency Fund Intact

Save At Walmart

Search

Personal Finance Education

Investing Education from Morningstar.

As Seen On Intuit

Intuit.com has ranked Coolchecks.net #4 out of 10 of the best blogs to help you save money. We hope to help you become more aware of your own financial situation and strive to improve it.

Featured On Mint.com – July 2014

Mint Interview

Categories

  • Banking
    • Check Writing
    • Checking Accounts
    • Credit Cards
    • EMV Cards
    • Fees
    • Fraud
    • History
    • Student Loans
  • Best Of The Web
  • Budgets
    • Emergency Fund
    • Grocery Shopping
    • Saving Money
    • Spending Habits
  • Business
    • 3D Printing
    • Bankruptcy
    • Business Advertising
    • Business Development
    • Business Plans
    • Corportate Lessons
    • Data Mining
    • Legal Issues
    • Merchants
    • SEC
    • Security
    • Small Business Startups
  • Consumer Alerts
  • Cryptocurrency
  • Cutting Costs
  • Employment
    • best places to work
    • Careers
    • Interviews
    • Job Search
    • Top CEOs
    • Wages
  • Entrepreneurs
    • Attitudes
    • Entrepreneur Interviews
  • Featured
  • Finance
    • Automobiles
    • Credit Ratings
    • Education
    • Financial Planners
    • Foreclosures
    • Homes
    • Insurance
    • Investing
    • Mortgages
    • Personal Finance
    • Renting
    • Term Deposits
    • Travel
    • Work
  • Fraud
  • Government
  • Holidays
    • Christmas
    • Halloween
  • Internet
    • Bitcoin
    • Blogging Tips
    • Blogs, RSS and Podcasting
    • Databases
    • Facebook
    • Influence
    • marketing
    • Twitter
    • Website Reviews
    • WordPress
      • Key Words
  • Investing Basics
    • Hedge Funds
    • Investing
    • Mutual Funds
  • Life
    • Aging
    • Just For Fun
      • Punahou Alumni Corner
    • Millennials
    • Personal Health
  • Money Making Ideas
    • Affiliate Programs
    • Craigslist
    • Ebay
  • Money Management
    • Bankruptcies
    • Building Wealth
    • Child Care Costs
    • Christmas Shopping
    • Credit
      • Free Credit Report
    • Debit Cards
    • Debt
    • Debt Reduction
    • Health Insurance
    • Income
    • Inheritance
    • Interest Rates
    • Loans
    • Mortgages
    • New Years Resolutions
    • Retirement
    • Shopping Tips
    • Tax Strategies
    • Your Stories
  • Retirement
  • Self Improvement
    • Time Management
    • Work Habits
  • Shopping
    • Coupons
    • Online Shopping
  • Social Security
  • Tax Tips
  • Taxes
  • Technology
  • Trade
  • Uncategorized
  • Wealth

Best of Personal Finance Blogs

Best of BuyerZone Business Finance Blog Recipient

Personal Finance Sites We Recommend

Get personal finance advice from the people behind the top money blogs, including Wise Bread, The Simple Dollar, Mint and Nerd Wallet.

Copyright © 2025 ·Metro Pro · Genesis Framework by StudioPress · WordPress · Log in