How long do pending transactions take to clear?

Pending transactions are charges that have been initiated but not yet fully processed or settled. They can take anywhere from a few hours to five business days to clear, depending on the charge. Restaurants, hotels, and car rental companies often initially list charges as pending until the payment is fully processed.

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In this article, we’ll explain what pending transactions are and how they work. We’ll also give you an idea of how long the various types of pending charges take to resolve and what to do if you have an issue with one.

What is a pending transaction?

A pending transaction is a credit card charge that hasn’t been fully processed. These transactions can occur when the money needed for the transaction is still being transferred between accounts. They will not yet be reflected on your checking account balance or available credit.

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Several transactions may show up as pending, such as when you use your card to leave a tip at a restaurant or buy gas at the pump. Online shopping can also result in pending transactions until the merchant processes your payment and ships your order.

How long do pending transactions take to clear?

The time it takes pending transactions to clear can range from a few hours to several days or more, depending on factors including the merchant's processing time, weekends, holidays, and your credit card provider’s policies.

Other types of pending transactions

Aside from pending credit card transactions, you may come across pending charges when using online banking. Here are some timelines to expect for charges to clear based on the type of transaction:

• Direct deposits usually clear by the next business day.
• Check deposits at the bank, ATM, or via banking app usually take up to 2 business days.
• Wire transfers usually take 1 business day, while international wire transfers can take up to 2 weeks.
• ACH payments usually take 1 to 5 business days.

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Are pending transactions already deducted from my account?

Pending transactions are not yet deducted from your bank account, despite showing up in your account activity and available current balance.

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The purchase amount will be temporarily deducted from your available funds, but the actual deduction will only occur when the transaction is processed. It's important to keep track of your pending transactions—if you don’t have enough money in your account to cover them, you could be hit with overdraft fees or other unexpected charges.

Can pending transactions be declined?

Yes, pending transactions can be declined even after they initially appear on your account as pending. This may occur for a variety of reasons:

• There are insufficient funds to cover the charge
• Your bank has flagged the transaction as fraudulent
• There’s been a technical or processing error related to the transaction,
• The charge exceeds your credit limit
• The authorization hold expired
• There’s been a merchant finalization delay

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If a pending transaction is declined, the funds that were pending will typically be released back into your account, adjusting your available balance. Whether you rely on paper statements or rely on mobile banking, it’s important to regularly monitor your transaction history to stay informed about the status of any pending transactions and to address any issues promptly with your financial institution.

What causes pending transactions?

Some of the most common reasons for pending credit card transactions include bank holds, debit card holds, credit card holds, merchant holds, and a variety of other reasons.

Bank holds

Banks may place holds on accounts to monitor for unusual activity or protect against fraud, such as in cases of payment disputes or unusual spending patterns.

Debit card holds

In instances where you can't use your PIN for a debit card transaction, your debit card issuer will label the transaction as pending for up to 4 business days.

Credit card holds

Credit card payments take less time to clear than debit card payments. Usually, your credit card issuer will verify that you have sufficient funds, and then clear the transaction within 48 hours.

Merchant holds

Merchants like hotels and gas stations use authorization holds to verify the card and reserve funds for potential additional charges, causing transactions to show as pending.

Canceled transactions

If a transaction is canceled after being authorized, it may still appear as pending until fully processed.

Subscription renewals

When a subscription is due for renewal, a merchant may request authorization from the credit card issuer to ensure the card is still valid and has sufficient funds, resulting in a pending transaction.

Fraud and anti-fraud authorizations

Unknown pending transactions can indicate potential fraud. Conversely, companies may apply small pending charges as a security measure to confirm card ownership and prevent fraudulent activity.

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How to cancel a pending transaction

If you want to cancel a pending transaction, you'll need to reach out to the merchant. They can then contact your credit card issuer to cancel the payment. Several factors can impact your ability to cancel a transaction:

Purchase category

Some merchants, like restaurants and gas stations, will typically place a hold on your card that results in a pending transaction. Travel agents may place a hold that lasts up to 30 days. Be aware that with some categories, your best course of action is simply to wait.

Delayed shipments

If your charge is pending due to a delayed shipment, contact the seller and ask them to cancel the transaction until they complete the shipment.

Holidays

During bank holidays, your card purchases may lead to pending transactions. Usually, the pending payment will be finalized during the first business day following the holiday.

Banking hours

Banking hours are usually 9 am to 5 pm, Monday through Friday. Any credit card charges outside these hours will likely be held as pending payments until at least the next business day. If the charges don't clear by then, consider contacting the merchant to see if they can lift the pending payment.

Gain complete transaction visibility with Ramp

Ramp gives you complete visibility into all of your transactions in one platform.

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Ramp’s automated expense reporting and categorization tools are designed for business owners looking for a centralized location for all of their finances.

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Our expense management tools come paired with Ramp’s FDIC-insured corporate charge card, which includes the following features:

• An average savings of 5% on total card spending
• Spend control and management features
• The ability to identify and flag fraudulent, suspicious, and unauthorized charges in real time

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See how your business can save time and money with Ramp.