Credit Card Authorization Form

A credit card authorization form is a document that allows a merchant, business, or service provider to obtain permission from a cardholder to charge their credit card for a specific transaction or a series of transactions.

In this article, you will learn what a credit card authorization form is, how to fill it in, and where to get a template for free.

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Who May Need a Card Authorization Form

Consider a café that provides lunch catering for a local business. Instead of charging the business for every delivery, which could be cumbersome, the café might ask the business to sign a credit card authorization form. This streamlines the process by allowing the café to charge the business’s card for deliveries without negotiating payment methods or obtaining signatures for each transaction.

Another example is a company that leases expensive equipment. To protect themselves from potential damages, the leasing company may use a credit card authorization form to place a hold on the customer’s card every time they lease an item, releasing the hold once the equipment is returned.

Credit card authorization forms are suitable for various business types, including those that bill customers on a recurring basis for goods or services, and those that allow customers to place deposits for future purchases.

Why to Use the Form?

One significant advantage of using a credit card authorization form is that it allows businesses to charge a customer’s credit card without the customer being physically present during the transaction. Additionally, it helps protect sellers from chargeback fraud, which occurs when a customer makes an online purchase using their credit card, then requests a chargeback from their bank issuer after receiving the goods or services. Chargebacks can pose a problem for businesses, as the disputed funds may be held, and resolving the issue can be time-consuming and require extensive paperwork.

A credit card authorization form enables businesses to charge customers at regular or irregular intervals, providing legal permission to do so. Having a signed document in place increases the chances of winning a dispute with the card issuer if any issues arise.

For businesses that handle recurring payments, credit card authorization forms offer two key benefits: reducing the risk of customers claiming they never consented to the charges, and saving time by eliminating the need to enter credit card information for each payment. These forms streamline the payment process and offer additional protection for both sellers and customers.

What to Include in Card Authorization Forms

Typical credit card authorization forms will include:

  1. Card details: Information about the card (debit or credit), account holder’s name, card number, expiration date, and billing address.
  2. Card security code (CSC): A 3- or 4-digit security code, usually found on the back of the card (Visa, MasterCard, and Discover) or on the front (American Express).
  3. Seller’s details: The name and type of business or service provider.
  4. Authorization statement: Specific language indicating that the customer authorizes the seller to charge the provided card for the transaction(s).
  5. Authorization type: Clarification of whether the authorization is for a one-time transaction or recurring payment.
  6. Description of goods or services: A brief description of the product(s) or service(s) being purchased, if applicable.
  7. Transaction amount: The total amount that the bank account holder authorizes the merchant to charge, if applicable.
  8. Date of transaction(s): The date(s) when the transaction(s) will occur or the billing period, if applicable.
  9. Customer’s name and signature: The cardholder’s printed name and signature, confirming their agreement to the charges.
  10. Date of authorization: The date when the customer signs the form.

How to Use Card Authorization Forms

The process of charging a credit card or customer’s bank account is fairly simple, especially if you choose to use the ready-made forms provided on our website. All you have to do is download a free form and then fill in the information according to our simple instructions.

Step 1 — Get the customer’s and account information

Once the buyer and seller have agreed on the terms of the purchase, they can complete the written consent form. The form should contain enough information for the payment processor, typically including the customer’s name, card number, expiration date, and billing address.

Step 2 — Choose the type

The credit card authorization form should clearly indicate whether the authorization is for a one-time charge or recurring transactions.

Step 3 — Obtain the signature of a customer

Finally, have the customer sign the form to confirm their consent to the charges. Keep the signed form on file for your records and in case of any disputes.

By following these steps, businesses can use credit card authorization forms to facilitate transactions and protect themselves from potential payment-related issues.

How to Fill Out a Credit Card Authorization Form

Step 1: Choose the authorization type

Select either the “Recurring Charge” or “One (1) Time Charge” option, depending on whether you want to authorize regularly scheduled charges or a single charge.

Step 2: Complete the authorization details

For the chosen authorization type, fill in the required fields:

  • Your full name
  • The merchant’s name
  • The charge amount
  • The date (or day of each billing period for recurring charges)
  • The frequency of the charge (e.g., week, month, etc., for recurring charges)
  • A description of the goods or services being purchased

Step 3: Fill in your billing information

Provide the necessary billing details, including:

  • Billing address
  • Phone number
  • City, state, and zip code
  • Email address

Step 4: Enter your payment information

Choose either the Bank (ACH) or Credit Card option, and fill in the required fields for the customer’s or third party’s credit card:

For Bank (ACH):

  • Checking or Savings account
  • Name on account
  • Bank name
  • Account number
  • Routing number

For Credit Card:

  • Visa, MasterCard, Amex, or Discover
  • Cardholder name
  • Account number
  • Expiration date (month and year)
  • CVV (card security code)

Step 5: Review the terms and sign the form

Read the terms and conditions carefully. By signing the form, you agree to the outlined terms and authorize the specified charges. If you understand and agree with the terms, sign the form, and print your name. Also, provide the date of your signature.

Once the form is completed, submit it to the merchant as required. Retain a copy for your records, and remember to notify the merchant in writing if you need to make changes or cancel the authorization.

Frequently Asked Questions

What is an authorization hold?

An authorization hold is a temporary freeze on a specific amount of funds in a customer’s bank account following a merchant’s request. This ensures the merchant will receive payment for the goods or services purchased using a debit or credit card. The hold is considered pending until the transaction is completed or the hold is released. Authorization holds serve as a smart and effective way for merchants to protect themselves against chargeback abuse and unnecessary refunds.

Is it possible to charge someone without a card authorization?

While all legal payments require obtaining permission from the customer, a card authorization form is not always necessary. Customer permission can be obtained in various ways, and in many cases, a customer’s signature is considered sufficient authorization for a transaction. However, using a card authorization form can provide an extra layer of protection for merchants against unauthorized transactions, especially when it comes to recurring payments or transactions where the customer is not physically present.

Published: Aug 10, 2022