This article explains the life cycle of card and eCheck payments, detailing each stage from authorization to capture, settlement, and funding. It also describes the key timelines for processing, including windows for capturing authorized transactions and reversing or refunding a transaction.
Life Cycle and Timeline Overview
When a sale or authorization transaction is executed on the Payrix Pro platform, it receives an Approved status shortly after the payment is accepted. Unless reversed, the transaction is subsequently captured in the merchant’s daily settlement batch, changing the status to Captured. Upon the completion of this settlement process, the transaction is updated to Settled, signifying that the funds have been successfully processed and deposited into the merchant’s account.
The following diagram depicts the transaction capture and settlement timeline. For more information on the different types of transactions and their statuses, see Transaction Types and Statuses.
Batch Close
At 9:30 PM Eastern Time (ET), the merchant’s daily settlement batch is closed, initiating settlement and updating approved Sale transaction statuses to Captured and eCheck Sale transactions to Approved by 10:00 PM ET.
Funding
The following table describes how funding occurs in two phases:
Important!
Unless uniquely enabled for a US-based account, the deposit of captured and settled funds occurs only on business days and doesn’t occur on weekends or holidays. For timelines that apply to Canadian merchants, see Canada Payment Processing Standards and Requirements.
Phase | Time (Eastern Time) | Business Day | Description |
|---|---|---|---|
Disbursement | 7:00 PM ET | The business day after batch close | Captured funds settle and begin disbursement to the merchant, minus fees, for payout to an external bank account. |
Deposit and Transaction Settlement | 8:00 AM to 10:00 AM ET | The business day after disbursement | Settled funds are deposited to the merchant’s account balance and each transaction included in the batch updates its status to Settled. |
For example, if a batch closes on Monday, the funds are disbursed at 7:00 PM ET on Tuesday and then deposited to the merchant’s account by 10:00 AM ET on Wednesday.
Card Payment Processing
When a card payment (a Sale transaction) is initially submitted to the platform, the details are immediately sent to the issuer for authorization. This includes fund availability, address verification service (AVS), and CVV results.
After the issuer authorizes the transaction, the status in Payrix Pro changes to Approved. If the issuer declines the authorization, the payment status changes to Failed.
This process varies slightly if the merchant is processing payments using an external terminal device.
Depending on your portfolio's Risk setting configuration, if the transaction returns AVS Unavailable/Mismatch or CVV Unavailable/Mismatch, the payment may be reversed and is reflected with a Failed status in Payrix Pro. If this occurs, you see a Related Transaction entry offsetting the original payment amount (Reverse Authorization), which prevents the transaction from settling, and no funds are sent by the issuer.
After a card transaction is approved, it is included in the merchant’s daily batch to be Captured and then Settled, and for the funds to become available to them in their Payrix Pro available balance.
Daily Batching
A daily batch refers to any payments processed by a merchant between their last batch close and the current batch close.
A Merchant’s daily approved transactions are all sent simultaneously at the end of the business day to the processing bank to be captured and settled. This means finalizing all batched transactions and exchanging funds between the cardholder’s bank and the platform (acquirer) for the corresponding merchant to receive a disbursement of those funds to their Available Balance.
The following tables describes the batch cutoff times for card payments each business day:
Daily Batch | Cutoff Time (Eastern Time) | Upon Batch Submission |
|---|---|---|
First batch | 7:00 PM ET | Transactions processed between 9:31 PM ET the previous day through 7 PM ET on the current day change from Approved to Captured. |
Second batch | 9:30 PM ET | Transactions processed between 7:01 PM and 9:30 PM change from Approved to Captured. |
Regardless of which of these two batches a transaction is a part of, they will all be settled by the processing bank at the same time. This generally occurs approximately 30 minutes after the second daily batch closes.
Transaction Reversal or Refund
Merchants can reverse or refund a transaction depending on its status:
If a transaction is approved, the merchant can reverse it by canceling or voiding the transaction (sometimes called a Reverse Auth). See Reverse Transaction to learn more.
If a transaction is captured, it must be refunded in order to reverse the funds back to the cardholder. See Refund Transaction to learn more.
Transaction Funds Added to Available Balance
Funds collected from a card payment are added to the Merchant’s Payrix Pro Available Balance at approximately 10 PM ET on the same evening that the transaction was submitted.
Any payment submitted between 9:31 PM ET of the previous day and 9:30 PM ET on the current day is present in the Available Balance at 10 PM ET of the current day.
eCheck Payment Processing
An eCheck transaction takes three to five business days to process and is dependent on the customer’s bank (an RDFI or issuing bank). Like card payments, eCheck transactions immediately update to Approved status after they are successfully submitted to Payrix Pro.
Unlike card transactions, eCheck transactions reach the Capture and Settled statuses on the day after they reach an Approved status. For example, if an eCheck payment is approved on Monday, it is captured and settled with Tuesday’s batch of transactions.
eCheck transactions also differ from card payments as the Settled status does not mean that an eCheck was funded or has been added to the Merchant’s Available Balance to be disbursed to their bank account.
Transaction Reversal or Refund
If an eCheck payment fails, such as due to insufficient funds or incorrect bank account information, the transaction status changes to returned. Because an eCheck payment is captured and settled prior to the transaction being funded, an eCheck status can change to returned even after it was captured and settled.
If a transaction is approved, the merchant can reverse it by canceling or voiding the transaction (sometimes called a Reverse Auth). See Reverse Transaction to learn more.
If a transaction is captured, it must be refunded in order to reverse the funds back to the cardholder. See Refund Transaction to learn more.
The reversal or refund is reflected in the merchant’s balance within two business days of the date the return was issued by the bank.
Transaction Funds Added to Available Balance
Funds collected from an eCheck payment are added to the Merchant’s Available Balance within three to five business days. Once funded by the issuing bank, the eCheck funds are disbursed to the merchant’s bank account as part of their next scheduled withdrawal.
Any payment submitted between 9:31 PM ET of the previous day and 9:30 PM ET on the current day is present in the Available Balance at 10 PM ET of the current day.
Transaction Capture Windows
When accepting credit card and eCheck payments, there is a limited time frame to capture funds through transaction authorizations provided by card brand issuers and banking institutions. The following sections outline the limitations of this time-sensitive process.
Credit Card Capture Time Limit
Authorized credit card payments provide varying timeframes for capturing transaction funds. Each card brand issuer has its own time limit to use the valid authorization:
American Express (Amex): 7 days
Diners Club: 7 days
Discover: 30 days
Mastercard: 7 days
Visa: 30 days
eCheck Capture Time Limit
Although NACHA does not specify a particular time frame, most processors and banks consider eCheck payment authorizations valid for a period of up to 30 days, unless stated otherwise.
Expired Authorizations
When an Approved transaction’s authorization expires, it must be reauthorized to obtain a new authorization code through a new transaction.
Important!
Expired authorizations do not trigger automatic transaction reversals. The transaction persists and remains Approved even after the expiration time frame has passed. To revoke this approval, you must process a reverse transaction. See Reverse and Refund Payments for more information.
Customer Funds Return Process
If the authorized transaction funds are not captured, a reverse transaction must be processed, where the pending charge shown on the customer’s account statement are removed and the authorization revoked.