What is a credit card authorization form or what is the advantage of the form? When you have to make a payment by credit card and the card is not present with the customer, there is some high risk that you might be taking.
However, to protect against the risk which includes chargeback, you can ask your customer to sign a document that gives you access to charge their card on an ongoing basis. The document is known as a credit card authorization form.
As a business owner, you are facing some risk when you take payments via credit card without the card being physically present with the cardholder. To protect your business, you will have to adopt a secure means for business which is why you have to create a credit card authorization form to protect your business.
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What is a credit card Authorization Form?
A credit card authorization form is a document that is signed by a cardholder, that gives a merchant permission to charge their credit card for recurring payments during a period of time as written in the document. The form is given business owners the authority to charge the cardholder’s credit card account on a recurring basis, it may be monthly, quarterly, annually, or weekly.
When and Why Should I Use Credit Card Authorization Forms?
As aforementioned before, a credit card authorization form is used when merchants need to charge a customer with a credit card that is not present. As a business owner, you may be running at risk if you accept payment in this scenario without the form. The main risk that you will face is a chargeback.
A chargeback on the other hand is used to protect a consumer from unauthorized transactions and fraudulent activities. And chargeback can bring negative effects on your business. A credit card authorization is what you need to resolve this issue because the cardholder has signed and given you permission to charge the credit card account if there is a chargeback.
What is Needed in the credit card authorization Forms?
A credit card authorization form is a simple form. It does not have to be complicated so it can be easily comprehended by the customers. What is included in the form is;
- The cardholder’s credit card information which includes
- Card type
- Name on the card
- Card number
- Expiration date
- The retailer’s business information
- Cardholder’s billing address
- Language authorizing the retailer to charge the customer’s card on file
- Name and signature of the cardholder
- Date of the
Am I legally obligated to use credit card authorization forms?
Credit card authorization forms are best for merchants and retailers. However, it is not legally required; you should ask your lawyer when they would suggest using one.
How to Accept payments with a Credit Card Authorization Form
Accepting payments with credit card authorization forms is very easy. You can charge a credit card by following the steps below.
- Collect the cardholder’s name
- Card number
- Expiration Date and billing address
- Next, enter If the credit card should be charged for a one-time payment or if it will be a recurring payment
- Next, ask the cardholder to sign the form
- Lastly, you can charge the credit card for your payment.
Ensure you collect the right information from the cardholder. If not, the payment will not be charged. Also, ensure that the cardholder signs the authorization form. This is because; it will give you access to charge the account for payment.
Why is Credit Card Authorization Form important for Merchants and businesses?
It is straightforward for cardholders to contact the bank for any false or fraudulent charge on their account; there is also a need for merchants and businesses to minimize losses in order to safeguard their business. Although businesses can disagree with a chargeback, it may have a negative effect. Hence, companies should adopt the credit card authorization forms system.
Types of Credit card authorization Forms
There are different kinds of credit card Authorization Forms templates. Each depends on the specific business and the context you are dealing with.
Standard Credit Card Authorization Form
This type of form is the universally accepted form and it can be used for various types of purchases. Also, it required essential information for most credit card authorization.
One-Time credit payment form
This is a form that is used for payments that will occur only once. This is more basic and easier to fill
Recurring payment Credit Card Authorization Forms
This type of authorization form is used for purchases and consumers who want to allow recurring payments. Meanwhile, the recurring payment authorization form will include the frequency and amount to be charged for each time.
Hotel Credit Card Authorization
This is used for guests who are using third-party’s credit cards. Also, this card will be used to make purchases to enable you to stay at the hotel. It demands the signature and authorization of the cardholder.
How do I fill out credit card Authorization Forms?
The forms can be filled out using an online template. Many credit card authorization form templates are available for free download. It must be created in a written format and printed by merchants or business owners. Once it is completed, you can print it and it must be filled and signed by the cardholder.
Where Can I download the Authorization Forms?
Additionally, Click here to download the credit card authorization form template.
is it safe to give out all my details for a Credit card Authorization Form?
No, you can give out your credit card number, name, and expiration date but not the CVV.