How to cancel a pending transaction on a credit card, debit card or PayPal

If you’ve ever paid for something with a credit or debit card, you’ve probably seen a pending transaction on your account. These charges usually appear at the top of your most recent statements and, although they are not necessarily permanent, they affect your total available balance. You may also find pending transactions in your PayPal account, depending on how the person you’re paying wants to receive their funds.

Seeing these pending transactions can be a bit shocking, especially if you weren’t expecting them. Learn more about pending transactions, how to cancel one, and how to dispute a posted transaction once it’s finalized.

Key points to remember

  • Pending transactions occur when a payment has been authorized by your card issuer but has not been completed.
  • A pending transaction will affect the amount of credit or funds you have.
  • Canceling a pending transaction usually requires contacting the merchant who made the charge.
  • Once a pending transaction has been posted, contact your bank or card issuer to dispute it.

What is a pending transaction?

Every time you swipe your debit or credit card, the merchant charges your card. These fees then go through a process that alternates between payment networks, your bank, and the merchant themselves. All of these steps take time to process and clear. While your transaction progresses through the system, it remains pending. Once your card issuer transfers the funds to the merchant on your behalf, the transaction is finalized and posted to your account. It’s a well-oiled system, and most of the time you won’t see any unexpected charges pending on your account.

Pre-authorization fee

Sometimes you will see a pending transaction on your account that is larger than a purchase you have made (or intend to make). This can happen when you buy gasoline or rent a hotel room, for example. Gas stations may place a large transaction on hold on your account to refuel. When the transaction is validated, your account will be debited with the actual quantity of gasoline that you have purchased. Upon check-in, hotels often collect a deposit to cover incidental charges or damage to the hotel room. After your departure, the hotel will refund your deposit minus the costs incurred. If you don’t have any additional charges, the entire pending transaction will simply disappear.

Several US states have sought to add protections against extra-large pending transactions. Tennessee law, for example, requires merchants to notify consumers of debit card holds that exceed 25% of the actual purchase, or $50, whichever is greater.

Pending transactions and debit cards

Using a debit card instead of a credit card for purchases that incur holds can be a risky proposition. This is because a pending transaction on a credit card will simply limit your available credit balance. However, a pending transaction on your debit card will limit access to actual funds in your account for as long as the transaction completes. This can be problematic if you have bills to pay and the amount withheld has not yet been returned to you.

Pending transactions and PayPal

Pending transactions with PayPal can also occur, as can debit or credit cards. However, PayPal has another side to its transactions: sending payments through PayPal’s system. If you sent a payment to a friend or merchant, the transaction may appear as pending in your PayPal account. Depending on the situation, you may be able to modify or cancel the payment before it is claimed.

How to cancel a pending credit or debit card transaction

Sometimes you may want to cancel a pending transaction as soon as possible. This may be the case if the hold is placed on your debit card and therefore on your bank account. Unfortunately, this isn’t very easy to do – your card issuer doesn’t have the ability to cancel or change the transaction until it’s been finalized. If you wish to eliminate the transaction before this date, contact the merchant who made the charge. Ask them to contact your card issuer and cancel the transaction. The trader has the option of requesting the release of the hold.

If you see a pending transaction that you know you didn’t complete, such as a fraudulent purchase, contact your card issuer immediately. They can work with you to monitor the transaction, protect your privacy, and reduce your liability if the fee ends up being charged.

How to cancel a pending PayPal transaction

If you’ve sent funds to someone and you see a pending transaction in your account, it could be due to one of two reasons. First, you may have sent money to someone whose phone number or email address isn’t associated with a verified PayPal account. If this happens, you can cancel your payment through the “Activity” section of your account.

Alternatively, you may have sent funds to a merchant that doesn’t accept payments automatically. It simply means that the merchant will have to accept or decline your payment. Once you have sent the funds to this type of merchant, you will not be able to cancel this transaction.

How to dispute a recorded credit card or debit transaction

If an erroneous pending charge you noticed ends up being posted as a transaction, don’t worry. It is easier to dispute a posted transaction than a pending transaction. Under the Fair Credit Billing Act (FCBA), banks are required to recognize a disputed transaction no later than 30 days after receiving your complaint. They must then resolve it within two billing cycles, which cannot exceed 90 days from the date of your complaint.

Fortunately, many banks will allow you to dispute a charge online, which may be easier than sending a letter of complaint.

The essential

Unfortunately, canceling a pending transaction is not always straightforward. If you try to remove a hold or pending transaction before it is posted, you will need to contact the merchant and ask them to remove the authorization. Once your transaction is finalized, however, you have more power to reverse the charge. Through the FCBA, you can dispute charges you believe are incorrect and banks are required to respond as soon as possible.

Frequently Asked Questions (FAQ)

How long does it take to post a pending transaction?

The time it takes for a transaction to be posted depends on when the merchant processes their account. Transactions are usually posted within three days, but can take five or more days.

Can you cancel a pending transaction online?

Usually, no. Unless you sent a payment via PayPal to an unrecognized email address or phone number, you will need to contact the merchant to cancel the pending transaction.

Why can’t a pending transaction be cancelled?

Since a pending transaction is temporary and subject to change, you cannot edit it until it is finalized and posted to your account.



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