Fed up with the whole concept of pre-authorisations

Oneg

I recently ordered a laptop using Paypal which is linked to my debit card. I cancelled the order as I saw a better deal. Trying to get my pre-authorisation removed so that I can spend my money is impossible.

I am totally fed up with the whole concept of pre-authorisations. The idea is flawed. Yes, thank you, the authorisation has been removed from Paypal after pestering the seller to do this, but paypal have not removed the authorisation from my bank account. Therefore I am still unable to spend my money! Paypal say my bank has acknowledged the removal of the authorisation, but my bank deny this, and refuse to remove it. Paypal even gave me a 6 digit authorisation removal code, but my bank say they still can't remove the authorisation. Why not?

The fault is with the whole banking industry. Why pre-authorise? What purpose does it serve? Why not simply take the money straight away instead of just ring fencing it? It makes no difference to me. Either way I still can’t spend it. Then the seller can ship knowing the item has already been paid for. If I cancel, then they can refund the money. It would be far quicker than waiting for an authorisation to drop off.

No one seems to understand this. The only people that win are the banks who are making money from this massive pool of pending authorisations. It is such a rip off. It is about time it was outlawed.

PeacefulWaters

the only people that win are the banks who are making money from this massive pool of pending authorisations

Quantify how they do this and how much they make. Especially for credit cards.

Oneg

At the start of my post, I mentioned DEBIT card. There is no DEBIT card section I can see on this forum, so apologies for that. I cannot quantify how much money banks make by investing other people's money, but I would have thought that is their business model.

surreysaver

Oneg wrote: »

At the start of my post, I mentioned DEBIT card. There is no DEBIT card section I can see on this forum, so apologies for that. I cannot quantify how much money banks make by investing other people's money, but I would have thought that is their business model.

Try the Bank Account sub-forum. Current Accounts are what debit cards are linked to.

Oneg

Well excuse me for posting on the wrong forum. The topic itself of course is irrelevant! Someone somewhere decided to thrust the concept of pre-authorisations onto the masses, and we all accept it. Sheep.

chattychappy

CC pre-authorisations go back to the days of manual processing. For certain transactions (particularly large ones), the merchant phones up and got a code (or a decline). Because it took a few days for the paperwork to go through, the funds are reserved in the meantime.

Debit cards piggy back onto the same system.

As with many IT things, systems build on what goes before. No doubt in some parts of the world people still use manual imprinters. The last manual one I encountered was about 5 years ago when checking out of a hotel during a power cut.

Oneg wrote: »

aSomeone somewhere decided to thrust the concept of pre-authorisations onto the masses, and we all accept it. Sheep.

I "accepted" it both as a user and merchant some years ago. I rarely use my debit card. I use credit cards and have never had a problem with pre-authorisations. Be careful with the "sheep" comment, ewe will attract all the predictable jokes.

PeacefulWaters

Oneg wrote: »

Well excuse me for posting on the wrong forum. The topic itself of course is irrelevant! Someone somewhere decided to thrust the concept of pre-authorisations onto the masses, and we all accept it. Sheep.

It's a game millions play without problem.

Why do ewe have a problem with it?

chattychappy

PeacefulWaters wrote: »

Why do ewe have a problem with it?

Because the OP is feeling fleeced?

agrinnall

Like a lamb to the slaughter...

RichL74

I recently had this experience and I cancelled my order but the pending transaction was there for roughly 2 weeks on my debit card.

I looked at is this way.

Say I have £100 in my account for arguments sake and I order an item for £75 which is pre-authorised. I cancel that order but £75 of that £100 is not available to me from my bank account, I can only take out £15 despite cancelling and until whoever it is presses a button or flicks a switch and the authorisation is removed giving me access to the full £100 again.

That reads a little woolly but hopefully you get my point.

eskbanker

Oneg wrote: »

I am totally fed up with the whole concept of pre-authorisations.

[...]

The fault is with the whole banking industry.

[...]

No one seems to understand this. The only people that win are the banks who are making money from this massive pool of pending authorisations. It is such a rip off. It is about time it was outlawed.

Oneg wrote: »

Well excuse me for posting on the wrong forum. The topic itself of course is irrelevant! Someone somewhere decided to thrust the concept of pre-authorisations onto the masses, and we all accept it. Sheep.