Credit Card Authorization Forms: What They Are And How To Use Them

If you’ve ever seen an authorization hold on a credit card statement, you might be a bit more curious about the payment process.

When you hand your credit card to a merchant and give them permission to set up future or recurring payments, you’ll often have to fill out a credit card authorization form.

We’ll walk you through the steps and cover what information you need to provide, so you know your transactions are secure.

What is a credit authorization form and how does it work?

A credit card authorization form is an agreement that gives a vendor permission to charge your credit card at a later date.

You’ll complete the form and sign it – and then the merchant can charge you once or for recurring charges on the same bill.

What is capturing?

After a merchant authorizes a transaction (verifies that your account is in good standing and has funds), the next step is capturing the payment.

Basically, the merchant specifies the final charges to be paid. For instance, if you charged room service, your hotel might add the cost of your meals to the final charge for your hotel room.

What is settlement?

The last step in an authorized transaction is settlement, when the money actually moves from your account to the merchant’s. After the merchant specifies the exact amount you owe, they pull the money. This concludes the transaction.

Depending on the type of transaction, capture and settlement can happen a few days apart.

Here’s when you might need a credit card authorization form

Most obviously, you'll want to use a credit card authorization form for things like recurring bills, but you may also use it for single payments that might happen later or where a hold is required for an unknown amount of money. These can include:

• Phone bills
• Your Netflix subscription or other streaming services
• Gym memberships
• Utility bills
• Buying gas – it’s common to authorize up to $100 or $200 and then be charged for what you actually filled up
• Hotel stays – most hotels use credit card authorization to charge for room service orders, taking drinks out of the minifridge, and property damage upon check out
• Car rentals – unless you purchase a full insurance package, you’ll need to provide a deposit in the form of a credit card authorization for potential damage to the vehicle

How to fill out a credit card authorization form

Credit card authorization forms are generally pretty straightforward. You’ll need to provide the following details:

• Credit card network (ie. Visa, Mastercard, Amex, etc.)
• Credit card number and cardholder name
• Expiration date
• Security code
• Billing name and address
• Cardholder’s phone number and email address
• Business information (if the charge is for work)
• Purchase amount and description of the item or services
• Customer ID, invoice number, or purchase order number

On some forms – like for hotels – you may need to select a statement authorizing charges that the card can be charged for, such as room service or minibar refreshments. You’ll also have to specify if the charge will be recurring.

You’ll typically complete authorization forms for bills online without much fuss, although sometimes, you’ll need to provide your signature with the date.

Alternatives to using a credit card authorization form

If you don’t want to authorize charges on your credit card, you can often choose to submit manual payments for monthly bills.

Most hotels, though, require some type of authorization to cover incidentals.

Take a look at some of your alternative options.

FAQ

What is a credit card authorization form?

A credit authorization form is a short document you complete and file with a merchant that authorizes them to charge your credit card for future purchases like recurring bills, tips, or hotel incidentals.

Is it safe to use a credit card authorization form?

Yes, it is safe to use a credit card authorization form if the vendor is reputable. If you're staying at a decent hotel, it's unlikely you will be charged for anything more than what you end up ordering or buying.

What is a credit authorization agreement?

A credit authorization agreement is essentially the arrangement you have with your credit card issuer that specifies the terms of using the card. For example, your agreement shows interest rates, payment expectations, and potential fees.

Can you tell me how to fill out a credit card authorization form?

Although credit card authorization forms vary, you’ll typically have to give information like your contact information, details about the item or services you’re buying, and your credit card information. You may have to sign the form, too.

What is a proof of authorization form?

A proof of authorization form shows that you’ve given someone or a merchant permission to process a transaction that you’ve approved.