Handling Late Authorized Payments

Generally, you do not need to handle late authorized payment as on an average, only less than 0.5% of the total number payments get late authorized. Additionally, the payments that are late authorized and not captured are auto-refunded in 5 days.

However, following are few suggestions on how you can handle payments that get late authorized:

  1. Communicate with your customer
    When a customer reaches out to you about a payment that was debited from her/his bank account before a successful order completion, ensure that you have clearly communicated about the status of the payment and how you will be handling it. You can choose to send out a message such as the following: “If your order has failed and the amount has been debited, the debited amount will be auto-refunded in 5 working days (without taking into account the processing time of your bank).”

  2. Understand your business need
    Depending upon your business needs, you can decide how to handle payments that may get late authorized. This would largely depend on whether you can provide service for the late authorized payment.

    1. If you cannot provide service for a late authorized payment, it can be ignored. Payments that stay in Authorized state will be auto-refunded to customers within 5 working days (without taking into account bank's processing time).
      For example, an online food ordering service needs to deliver food immediately on receiving payments. Since the need to deliver the service is immediate in this business, the merchant cannot oblige her/his customer if the payment gets authorized late. In this case, the merchant can ignore the payment made as it will be auto-refunded and communicate to the customer accordingly.

    2. If you wish to provide the service later, there are ways in which you can keep a close track of these payments and fulfill the order when it is authorized.
      For example, an online marketplace merchant that sells clothes and accessories, can mark the order as 'pending' in her/his system and deliver the order when the payment gets authorized.

    Note: Auto-refunds are issued within 5 days. However, if you want to issue a refund instantly, you can capture the payment and issue a refund as per your requirements.

  3. Utilize recommended options
    Following are ways in which payments that are authorized late can be effectively managed to fulfil your customer’s order:

Order API#

Order API makes it easier to handle cases of late authorization in the following ways:

  • It clubs multiple payment attempts against the same order. If one of the payment is successful and another attempt gets Late Authorized, the late authorized payment is refunded immediately and only successful payment is marked against the order.

  • It supports auto-capturing of normal payments. However, payments that are Late Authorized are not auto-captured. (This support feature can vary for different business models as auto-capturing of late authorized payments is available on request.) To enable this feature, you can get in touch with us at https://razorpay.com/support for any queries.

Note: Auto-capturing can be enabled for only those payments that have been authorized within 5 days of payment creation. If the payment remains in Authorized state even after 5 days, it will get auto-refunded.

  • Another advantage of using Orders API is that only one successful payment is allowed against an order. In case your customer retries the payment against the same order, Order API will ensure that only one successful payment is processed against it.

Webhooks#

Webhooks allow you to get notified when payments move to Authorized state. The webhook payment.authorized sends you a notification when the payment you were expecting to be Late Authorized moves to Authorized state. This allows you to send email notifications to your customers on the payment section and take further action to deliver the service. You can set up webhooks from the your Razorpay Dashboard. Go through our Webhooks documentation to know more.

FAQs#

Is late authorization of payment specific to Razorpay?
No. While other gateways also face these interruptions, Razorpay ensures that our merchants have a way of handling late authorized payments via Orders API or Webhooks and track their progress on the Dashboard.

Will a payment change to Authorized if the customer's account has been debited?
No. In some cases, although rare, banks automatically refund the transaction without changing the status. This can vary from bank to bank.