- What does "pending transaction" mean?
- How long do pending transactions take to clear?
- What causes pending transactions?
- Are pending transactions ever declined?
- How to cancel a pending transaction
- Factors that can affect your ability to cancel
- Get complete transaction visibility with Ramp
Pending transactions are charges that have yet to be fully processed or settled. Depending on the charge, they can take anywhere from a few hours to 5 business days to clear. Restaurants, hotels, and car rental companies often initially list charges as pending until the payment is fully processed.
This post explains what pending transactions are, how long they take to clear, and what causes pending transactions. Plus, learn how to cancel a pending transaction and what factors could prevent you from doing so.
What does "pending transaction" mean?
A pending transaction is a charge, payment, or deposit that hasn’t been fully processed by your bank or credit card. The funds are temporarily on hold, either reducing your available credit or your available bank balance, but the transaction hasn’t officially cleared.
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?
It’s normal for a charge to take a few days to post to your credit card account. Pending credit card charges typically clear within a few hours to several days, depending on factors such as the merchant’s processing time, weekends, holidays, and your card issuer’s policies.
Pending charges can also show up in banking accounts. The time it takes to clear often depends on the type of transaction. Here are some common timelines to expect for different types of bank transactions:
- Direct deposits: A direct deposit usually clears by the next business day
- Check deposits: If you deposit a check at the bank, ATM, or via a banking app, it can take up to 2 business days
- Wire transfers: Standard wire transfers usually take 1 business day, while international wire transfers can take up to 2 weeks
- ACH payments: It typically takes 1–3 business days for a pending ACH payment to clear
What causes pending transactions?
Some reasons for pending credit card charges include bank holds, debit card holds, credit card holds, and merchant holds, among others. Here’s a closer look at the most common causes:
- 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 debit card purchases, your debit card issuer will label the transaction as pending for up to 4 business days
- Credit card holds: Credit card payments typically clear more quickly than debit card payments. Your credit card issuer will usually verify that you have sufficient funds, then clear the transaction within 48 hours.
- Merchant holds: Merchants such as 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 you see a transaction canceled after authorization, 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 verify 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 credit card fraud.
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Are pending transactions ever declined?
You may see a pending transaction declined even after initially appearing as pending on your account. 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
What does it mean when a pending transaction says declined?
In the case of a pending transaction that’s declined, the pending funds are typically released, adjusting your available balance to its original amount. Whether you rely on paper statements or mobile banking, you should regularly monitor your transaction history to stay informed about the status of any pending transactions and promptly address any issues.
How to cancel a pending transaction
Here’s how to cancel a pending transaction, broken down by merchant and payment type:
Credit card
To cancel a pending credit card transaction, contact the merchant directly. Clearly explain your reasons for canceling and request that they void the charge. If this approach is unsuccessful, or you suspect fraudulent activity, contact your credit card issuer by phone using the number on the back of your card. Explain the situation in detail and inquire about the dispute resolution process.
Debit card
Similar to credit cards, you'll need to contact the merchant directly to cancel a pending debit card transaction. If this fails, contact your bank or debit card issuer to learn about the options available to you to void the transaction.
PayPal
Log in to your PayPal account and go to the "Activity" section to cancel a pending transaction. Find the pending payment, select it, and then select "Cancel" and "Cancel Payment."
Cash App
Go to the "Activity" tab in Cash App and select the pending payment you want to cancel. If the option is available, you should see a "Cancel" button. Select it to cancel the payment.
Factors that can affect your ability to cancel
You can’t always cancel pending transactions immediately, even if you contact the merchant. Factors such as the purchase category, timing, and shipping status often determine whether cancellation is possible:
- Purchase category: Some merchants, such as restaurants and gas stations, typically place a hold on your card, resulting 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 finalize during the first business day following the holiday.
- Banking hours: Banking hours are typically 9 a.m. to 5 p.m., Monday through Friday. Any charges outside these hours will likely fall into 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.
Get complete transaction visibility with Ramp
Staying on top of pending, posted, and flagged charges is key to managing your business finances effectively.
The Ramp Business Credit Card gives you complete visibility into pending and posted transactions in one centralized platform, with automated expense reporting and categorization tools to help you track and understand every charge in real time. With Ramp, you can:
- Identify and flag fraudulent, suspicious, and unauthorized charges in real time, even while they’re still pending
- Set custom controls on corporate cards for specific vendors and categories to prevent out-of-policy spend
- Create unlimited free virtual cards with custom permissions
- Give employees the ability to submit receipts and memos instantly via SMS, web, mobile app, or direct integrations with services like Gmail
- Personalize approval workflows to keep the right people informed, with automated reminders
See how Ramp helps your business stay on top of every transaction with an interactive demo.
FAQs
Pending transactions are not yet deducted from your bank account, despite appearing in your account activity and available current balance. The purchase amount won’t show in your available funds, but the actual deduction only occurs when the transaction is processed. If you forget about a pending charge and spend that money, it could trigger an overdraft or declined transaction, depending on your account balance and bank policies.
Insufficient funds, fraudulent activity, processing errors, merchant delays, and delays due to holidays or weekends may result in an extended period of a pending charge.
You generally can’t spend money tied up in a pending transaction. Although it may still appear in your account balance, it’s already earmarked for that payment and won’t be available until the transaction clears or you cancel it.
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