What is delayed capture for payments and how to set it up

Managing how and when you take payment is central to both customer experience and your own financial control. One important option is delayed capture. By separating authorisation from capture - in other words, the process of moving funds from your customer's account to yours - you gain flexibility in timing without losing the assurance of reserved funds. Understanding this process can help you reduce risk, handle operational complexity, and improve cash flow management.

What is delayed capture?

Sometimes called capture delay or deferred capture, delayed capture is where a payment is authorised but the actual capture of funds happens later. When a buyer uses a card or another payment method, the issuing bank places an authorisation hold on the account. This confirms that the customer has enough funds and reserves the amount, but the merchant does not immediately receive the money. Only after a capture request is submitted are the funds transferred. This approach is widely used for card payments, credit card transactions, and digital commerce where timing matters.

Put simply, authorisation and capture are two distinct stages: first, the payment is authorised; then, at the right moment, it is captured.

How does it work?

The flow of delayed capture follows a clear sequence:

1. Authorisation: When the customer completes checkout, the payment processor requests authorisation from the issuing bank. If approved, the amount is held.
   
   
2. Hold period: The bank applies an authorisation hold, usually lasting between one and seven days, depending on scheme rules. During this time, the money is reserved but not yet settled.
   
   
3. Capture request: At a later stage, the merchant submits a capture request. This can be a manual capture triggered by staff or an automatic capture based on business rules.
   
   
4. Settlement: Once captured, the funds are transferred to the merchant according to the settlement cycle.

This process provides more flexibility than immediate capture. It allows businesses to delay the capture of a payment until they are certain the goods or services can be delivered.

Examples of delayed capture

Delayed capture is commonly used in industries where the service or product is delivered after the booking or order.

Hotels and accommodation

Hotels often apply delayed capture when a guest books a room. The card is authorised at the time of booking, but funds are only captured at check-in or check-out, depending on policy.

Car rentals

Rental companies authorise a card at pick-up to cover both the rental cost and possible damages. The actual capture happens when the car is returned.

Travel and airlines

Airlines may use capture delay when confirming flight availability. The payment is authorised but captured only once the ticket is issued.

E-commerce with backorders

Online stores sometimes delay capture until the item is confirmed in stock and ready to ship, reducing the chance of refund requests.

Subscription trials

Services offering trial periods may authorise a payment method upfront but only capture funds when the subscription period begins.

Delayed capture vs. immediate capture

The distinction lies in timing. With immediate capture, authorisation and capture occur in one step, meaning the merchant collects funds right away. With delayed capture, authorisation and capture are separated.

Why delay capture of a payment?

• Reduce risk of chargebacks by confirming service delivery before collecting funds. This helps avoid disputes where customers claim they never received the product or service.
• Allow time for fraud prevention checks before finalising the payment. Merchants can use risk tools or review suspicious transactions during the hold period.
• Confirm product availability or stock before charging the customer. This is particularly useful for e-commerce businesses managing inventory across multiple warehouses.
• Manage changes, cancellations, or order adjustments without refunding captured payments. If a booking is cancelled or an order is modified, the authorisation can be released rather than refunded.
• Improve customer trust by charging only when the service is fulfilled. Customers may more likely return when they feel they are charged fairly.
• Support industries with delayed delivery cycles, such as travel, hospitality, and rentals, where the service date may be weeks after the booking.
• Provide flexibility in cash flow management by timing capture to align with business settlement preferences or operational needs.

How to enable delayed capture

Merchants should work closely with their payment service provider (PSP). Configuration depends on the PSP’s system and may involve setting business rules, enabling manual capture, or defining automatic capture delays. Establishing this correctly ensures that authorisation holds are managed effectively and that funds are captured within the allowed timeframe.

The setup process will vary by payment provider, but the general steps are straightforward:

1. Check supported payment methods: Not all methods allow capture delay. Cards and credit cards typically do, while some wallets may not.
   
   
2. Configure your system: In your payment dashboard or integration, enable manual capture or set capture delay rules.
   
   
3. Choose capture timing: Decide whether you want to trigger capture manually (manual capture) or after a set delay period (automatic capture).
   
   
4. Submit capture requests: When ready, send a capture request for the authorised amount. Some businesses capture partially if only part of an order ships.
   
   
5. Monitor funds: Keep track of the authorisation hold window to avoid expired authorisations.
   
   
6. Reconcile payments: Ensure your reporting tools track both authorisation and capture for accurate accounting.

Conclusion

The main advantage of delayed capture is control: merchants decide when settlement happens. This approach helps avoid issues with refunds, supports smoother operations, and reassures customers that they’re charged at the right point. Global providers such as Antom support both immediate and delayed capture across multiple payment methods, allowing merchants to choose the best setup for their business model.