How are Incremental Authorizations managed ?

An incremental authorization is a request to increase the amount of a previous approved authorization.

Incremental authorizations are typically used in the following scenarios:

• Hotels (as a guest incurs more charges)
• Car rentals (fuel charges or extended rental)
• At merchants with uncertain or variable final charges

When CLOWD9 receives an incremental authorization request from a network we will follow specific steps to ensure accurate processing, compliance with network standards and a positive cardholder experience.

The sequence of steps is :

1. Match to Original Authorization

Locate the original auth using standard network matching data.

This ensures that we are modifying an existing auth rather than creating a new one.

2. Validate Request

Check that:

• The original authorization is not already cleared or reversed.
• The cardholder account available balance has sufficient available credit/funds for the incremental amount.
• The total (original + incremental) doesn't exceed limits or trigger transaction monitoring flags.

3. Approve or Decline the Request

• If valid, approve the incremental auth and update the available balance by the incremental amount .
• If invalid, decline with an appropriate reason code e.g., insufficient funds, expired auth window, etc

4. Prepare for Clearing

• Ensure the final clearing transaction matches the total authorized amount (original + incrementals)

Important to note:

• Time Limits: incremental authorizations are typically allowed within a certain window (usually as long as the original authorization is valid). Outside of that the incremental request will be declined.
• Multiple Incrementals: CLOWD9 may receive more than one incremental request for the same original authorization; processing of a new incremental authorization must always consider the original authorization plus any prior approved incremental authorizations
• Reversals: If a merchant later reduces the total, a reversal (partial or full) should be expected.
• Chargeback Risk: If incrementals are mishandled, it may lead to disputes or chargebacks.