Authorization reversal window
During the credit card authorization process, a merchant seeks authorization for an order by contacting a payment system and then blocking the credit card for the settlement amount.
Typically, as this authorization expires, it automatically seeks reauthorization. However, if reverse authorization is enabled, in addition to seeking reauthorization, an authorization request is created for the same authorization ID, only in a negative amount. For example, an expiring authorization for $100 would initiate another authorization for $-100.
While the credit card company and the bank influence when the expiration occurs and when the reversal period ends, you can define an authorization reversal window based on your business metrics. These metrics might include the volume of throughput you have to the payment system, how often order modification is permitted, the percentage of orders against future inventory, and how often you run payment collection agents.
The following figure illustrates a typical authorization life cycle and where the reversal window might be in that life cycle.
In the figure, a reverse authorization can occur any time from the start of Authorization Acquired to the end of the Reversal Window. The ideal point of reversal for an authorization is as close to the end of this reversal period as possible, so that you can head off extra fees, but not too early in this reversal period, as this will incur additional costs.
If you are reversing authorizations, set the expiration date in the YFSCollectionCreditCardUE to the point shown in the figure, not the actual authorization expiration date. As a result, the system will start trying to reverse the authorization at this point, when there is still time to reasonably process a reverse authorization and to retry if the first attempt fails.
If you are not reversing authorizations, set the expiration date to the actual expiration date.
In some implementations and for some credit cards, the reversal window may differ from the one depicted in the figure. The period "Valid But May No Longer Reverse" may not exist because it might be possible to reverse an authorization right up to the actual expiration date without incurring extra fees.