With digital transformation and tech advancements, payments have become increasingly easier in the online commerce space. Customers can pay for their purchases in minutes and merchants can ensure that they are secure and seamless.
However, many online businesses also extend pre-orders on the goods and services they offer. In such cases ensuring timely payment collection from buyers becomes a crucial aspect.
Businesses need to establish a robust payment flow as well as a transparent process for such purchases, which usually are of a big-ticket size. Payment Pre-Auth plays an important role here and helps merchants ensure a seamless payment flow and a positive customer experience.
With state-of-the-art technological infrastructure and end-to-end payment security solutions, you can rely on Paytm Payment Gateway to solve your payment authentication issues. This blog explores some of the major benefits of Paytm Pre-Auth and describes the process, in brief, to help you understand its efficiency and importance for your business.
What is Paytm Pre-Auth?
Paytm Pre-Auth is a unique payment solution for online merchants to hold a certain amount of funds in their customers’ Paytm accounts. Whenever a customer places an order, the money is reserved by the merchant in advance for future transactions. Once the service or order is completed, the reserved amount is captured/deducted.
Merchants can block the order amount for a specific period to ensure successful payment post-delivery. During this period, the funds are inaccessible to the customer. However, in the case of order cancellations or unsuccessful payments, the amount is returned to the original payment source.
Pre-authorisation of funds is a progressive step in the online payment landscape as it allows merchants to establish a reliable payment process. This proactive approach is suitable for both merchants and customers, creating a better customer experience and revenue for online businesses.
Paytm Pre-Auth process overview
Here’s a look at the steps that are involved in the Paytm Pre-Auth process:
- A customer visits a merchant’s website/mobile app
- The customer is requested to link their Paytm account for a seamless checkout
- Once the account is successfully linked, the customer adds goods/services on the merchant’s site/app
- Merchant checks the availability of sufficient balance for the order using Check Balance API
- If the customer doesn’t have sufficient balance for the transaction, the merchant initiates an add-money process with the differential amount
- Subsequently, the merchant calls the Paytm Pre-Auth API to hold the amount in the customer’s account
- Once the order/service fulfillment is done, the Capture API initiates the deduction of the amount from the payment source and confirms the transaction