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I'm confused, why does the Trip Service talk to the issuer to place a hold? I would have expected the Payment Service to mediate all that. Particularly since "P

I'm confused, why does the Trip Service talk to the issuer to place a hold? I would have expected the Payment Service to mediate all that. Particularly since "Place Hold" is another way of saying "Authorize Payment". Perhaps the lines are wrong?

mschuster91 2y ago
> Particularly since "Place Hold" is another way of saying "Authorize Payment". As the article explains, it's not, at least from the merchant's side (from the customer's side it is). A CC hold tells the bank "hey guys, make sure that there will be at least X dollars available when we call in the hold", and the bank can either respond with "yes, hold confirmed" or "nope, declined" (say, due to a lack of funds, wrong CVV, whatever). When the hold is confirmed, and the customer makes another transaction at another vendor that would cause the amount of open holds + executed but not paid-off transactions to go above your limit, that transaction gets blocked. And eventually, only once you as the merchant call in the hold, you will actually initiate the flow of money. Or you call in less than the held amount, and you'll only get that amount of money (usually seen in hotels and car rentals, where the hold can be significantly larger than the bill, to account for stuff like minibar expenses, room cleaning or damages to the vehicle). Or you release the hold, or it expires, and you get no money at all, and all you can do is try to create a new transaction and hope it gets approved.
- ComputerGuru 2y ago
  But that’s what auth + capture does, though.
- jpollock 2y ago
  Authorize Payment results in the Hold. The diagram is representing a standard Auth + Capture credit card flow. Capture contains the final transaction amount and can either be higher or lower than the Authorized amount. The odd thing is the Trip Service shouldn't know anything about the Issuer. That's the Payment Service's reason to exist (so Trip Service doesn't need to know about different payment methods). That the Trip Service knows how to talk to Visa (and Amex, and MasterCard, and Discover, and Google, and Apple) about Auth'ing a card, but doesn't know how to Capture the payment is the strange part. My expectation is that the diagram is incorrect, and the TripService talks to the PaymentService to Auth the card.

mschuster91 2y ago

> Particularly since "Place Hold" is another way of saying "Authorize Payment". As the article explains, it's not, at least from the merchant's side (from the customer's side it is). A CC hold tells the bank "hey guys, make sure that there will be at least X dollars available when we call in the hold", and the bank can either respond with "yes, hold confirmed" or "nope, declined" (say, due to a lack of funds, wrong CVV, whatever). When the hold is confirmed, and the customer makes another transaction at another vendor that would cause the amount of open holds + executed but not paid-off transactions to go above your limit, that transaction gets blocked. And eventually, only once you as the merchant call in the hold, you will actually initiate the flow of money. Or you call in less than the held amount, and you'll only get that amount of money (usually seen in hotels and car rentals, where the hold can be significantly larger than the bill, to account for stuff like minibar expenses, room cleaning or damages to the vehicle). Or you release the hold, or it expires, and you get no money at all, and all you can do is try to create a new transaction and hope it gets approved.

ComputerGuru 2y ago
But that’s what auth + capture does, though.
jpollock 2y ago
Authorize Payment results in the Hold. The diagram is representing a standard Auth + Capture credit card flow. Capture contains the final transaction amount and can either be higher or lower than the Authorized amount. The odd thing is the Trip Service shouldn't know anything about the Issuer. That's the Payment Service's reason to exist (so Trip Service doesn't need to know about different payment methods). That the Trip Service knows how to talk to Visa (and Amex, and MasterCard, and Discover, and Google, and Apple) about Auth'ing a card, but doesn't know how to Capture the payment is the strange part. My expectation is that the diagram is incorrect, and the TripService talks to the PaymentService to Auth the card.