Balances and limits

Balances

PayCredit account's have two balances:

1. Authorized Balance: the account's current balance based on pending and settled transactions.
2. Settled Balance: the account's current balance based on settled transactions only.

When an authorization request is received, PayCredit calculates the available funds and takes the authorization decision. The calculation method used is Balance Limit - Authorized Balance = Available Balance (available funds).

• After a transaction is approved, the Authorized Balance is increased by the authorized amount (of the transaction).
• When a pending transaction is settled, the Settled Balance is increased to reflect the settled amount. In the event the settled amount of the transaction is different to the original authorization amount, the Authorized Balance is updated to reflect the difference.

Unblocking an authorization

As the Authorized Balance represents funds which are ‘blocked’ on the account, there is a product configuration option to release these funds if a pending transaction is not settled.

This PayCredit product configuration includes: “Number of days to unblock authorized balance”.

• Typically, 14 days is set as the number of days after which the status of a pending transaction is changed to cancelled, and the authorized amount is removed from the Authorized Balance.

Limits

The PayCredit system declines transactions where an account has insufficient funds. This means the cardholder cannot exceed the cards credit limit.

The only exception to this is that fees triggered by PayCredit and posted interest transactions can still be applied when a card has insufficient funds.

For example if a credit card has $50 available of a $1000 credit limit and a transaction is made for $55, the transaction will be declined. If a cardholder was then tomake a repayment of $45, bringing the available balance to $95 and then re-attempted the transaction of $55, this would then be approved.