In the article, we will consider what a hold is. If a person is used to controlling operations with his bank account (this is more convenient to carry out in the Internet bank), then he must have paid attention to the fact that after making a payment by card, the corresponding amount of money is not debited from the account, but frozen (reserved) by the bank for one or several days.
Moreover, the size of the available balance on a credit card decreases exactly by a frozen amount. The amount that is temporarily blocked on the client’s account is called “card hold” in banking terminology, and the operation of its reservation is called holding.
Basic concepts
The English verb to hold in translation means "hold", "hold." This is the reservation of a certain amount of money on the client’s card account until the financial transaction is confirmed or there is no confirmation within the time limits established by the bank.
In a professional language, such an operation is called holding, and among the owners of plastic cards such synonyms of the term are common as: freezing, blocking, hold-transfer, reservation, etc. It will be most correct if each of these synonyms is used together with the keyword: temporary. Such a process can be called in different ways, but the essence remains the same.
The essence of the process
Most bank card owners believe (or don’t think about it at all) that after they paid in the store with the funds from the card through the POS terminal, the money was immediately debited from their current account. In reality, the fact of payment is the beginning of many operations, which in combination are called "transaction" on a bank card. This process involves an acquiring bank serving the outlet (which owns the post-terminal), the issuing bank that issued the card, and the intermediary is the payment system that connects the above banks into a single “chain”.
It is thanks to her that a person can pay with his card anywhere in the world where there is appropriate equipment. The most famous payment systems: MasterCard and Visa. The final result of all these operations is obtaining permission to pay by card from the issuing bank. As soon as it is received, payment is made and the transaction amount is at the same time reserved (held) on the card. The reserved amount is the money in the hold.
Why is this money not debited right away?
The whole point here is the interaction algorithm of all banking organizations that are participants in a transaction with the payment system. As a rule, information on all card payments to the TSP at the end of the working day is sent to the acquirer bank, and based on the received data, clearing files are generated (information for debiting, which acts as a financial confirmation of transactions), and then these files are sent to the issuing bank through the payment system. Only after that is this financial institution debiting money from current accounts, i.e. credit card hold is terminated.
Automatic withdrawal
If a financial confirmation has not been received by the issuing bank for a specific operation, then after some time established by the bank, the hold is withdrawn automatically - the funds are unfrozen and again available to the bank card holder.
So, it has already been said that in most cases, the cardholder after making a purchase considers payment of the purchased goods or services to be a successful event, however, in practice there are also unpleasant situations in which the bank client has to deal with what the hold is in more depth .
Underwater rocks
In accordance with the basic rules established by the payment systems, the bank is obliged to write off the details specified in the received clearing files. If they do not coincide with the authorization details, the card is debited from the card due to the hold. Thus, it turns out that the payment was debited and the funds remained blocked. And a bank client, when requested on the balance sheet, sees minus both monetary amounts. The problem is resolved only with time, when the blocked financial amount does not find confirmation and unfreezes.
A similar situation may arise when the issuing bank delays receiving clearing files. The holding has already been withdrawn, but upon receipt of the details for the write-off procedure, the bank makes an expense transaction. If the amount of funds in the account is insufficient, the card balance will go into minus, that is, the so-called unauthorized overdraft will happen. In order to prevent such an unplanned “leaving the balance to minus”, you should not completely reset the bank account on the card: it should always contain some free amount of money.
Not an expense, but a reservation
Holding is not considered a waste of money - it is just a temporary reservation. Therefore, when the holding period ends, the money is “thawed” and the balance again increases by the reserved amount.
In addition, another unpleasant situation may occur during the purchase, when one amount of money is blocked, and the confirmation files are sent to another, smaller or larger, then this particular amount of funds will be debited from the account. This often happens due to conversion features, when payments are made in a different currency than the one shown on the bank card account (purchase in a foreign online store or directly abroad). This is due to the fact that the exchange rate may change from the moment the holding starts until the funds are completely written off.
Dates for which the holding period is set
In fact, the holding period directly depends on the period of time required for the implementation of the above “accounting entries”, and its maximum duration is usually 30 days, taking into account the norms of current legislation and the rules of the Ministry of Railways. Thus, any reservation of the amount is temporary. Banking organizations establish holding periods of no more than 30 days, most often from 7 to 15.
Speaking specifically about the holding period at Sberbank, it is a maximum of 30 days.
Temporary reservation of a current account or amount of money
This operation is the answer to the question of what is hold. At the same time, it is becoming a fairly popular service, which is offered by an increasing number of banks. This is a very convenient tool that allows you to expedite the receipt of a r / s number without visiting a banking organization and transferring documentation. In Russia, the service has been functioning relatively recently, and in the world it has long been in great demand.
The received number after booking a bank account may be indicated in the text of the agreement with partners and in other documents.
Temporary reservation of the amount can take the application form, which is submitted online. The purpose of this operation is to obtain in advance the details of a current account with a financial institution.
After registration, the bank allocates the time during which the client must come to transfer the required package of documents and receive a current account.
In the presented article, what is a hold.