The pre authorisation card payment UK hotels and restaurants take at check-in or at the table is not a payment yet. It is a hold: the customer's bank sets money aside, and nothing moves until the business completes the sale.
A hold on a card is not a payment.
That difference decides how much a hotel or restaurant can hold, how long the hold lasts and how soon it must go once the bill is paid. The card schemes answer all three in their rules.
UK payment law adds a rule of its own on blocked funds. We read the Visa and Mastercard rulebooks, that regulation, the help page of one UK bank and the guide of one card machine provider, and we flag the places where the two schemes differ.
Pre authorisation card payment, UK: what is it?
A pre-authorisation is a request to the customer's bank to approve an estimated amount before the final bill is known. Mastercard calls it a preauthorisation. Visa calls the same thing an estimated authorisation.
The bank behind the customer's card is the issuer.
Once approved, the amount is held on the customer's card. Teya's UK help page puts it in plain words: “Pre-authorisation allows you to temporarily hold a specific amount of funds on a customer’s payment card without charging them immediately.”
Two later steps decide what happens to that hold. Capture, also called completion, turns some or all of it into a real charge, and a reversal, sometimes called a void, cancels the hold so the bank can release the money.
Teya switches the feature on by default for hotels and for car and equipment rental, the industries it says need security deposits or tab management.
Teya's guide adds a limit on capture: a business can capture the full held amount or part of it, but never more than the sum it held.
Mastercard's rules name hotel checkout and the return of a rental car as cases for preauthorisation coding, because the cardholder may still choose another way to pay at that point. Visa marks such requests with its own flag, the Estimated Authorization indicator.
Banks describe the same hold to their own customers. First direct says a hotel or a pay-at-the-pump petrol station can take a pre-authorisation to put a temporary hold on funds until the final bill is paid.
The size of that hold can surprise a customer. First direct warns that it might be as little as one pound, or a higher amount than the final bill.
Why is a hold on a card not a payment?
In card terms, a hold only reserves money. A payment moves it to the business, and that move happens only when the business sends the clearing record, the message that turns an approval into a charge.
Mastercard requires that clearing within 30 calendar days of approval. An expired approval counts as zero under its rules.
UK law treats the hold as a block on the customer's funds. Regulation 78 of the Payment Services Regulations 2017 covers card payments started by the business where the amount is not known when the customer authorises them.
Under that regulation, the customer's bank “may not block funds on the payer's payment account unless the payer has authorised the exact amount of the funds to be blocked”.
The same regulation says the bank “must release the blocked funds without undue delay after becoming aware of the amount of the payment transaction, and in any event immediately after receipt of the payment order.”
That rule binds the customer's bank, not the hotel. Regulation 63 lists the rules a business customer may switch off by contract, and regulation 78 is not on that list.
For the guest, the hold should not become a debit unless the business completes the sale.
First direct's help page makes the same point to its customers. It says such amounts should not debit the account and will usually disappear immediately, though a release can occasionally take a few days.
How much can a hotel or restaurant hold on a card?
A business can hold a genuine estimate of the bill, and both schemes say the customer must hear the amount first. Visa's rules require that “The Estimated Authorization Request amount is a genuine estimation of what the Cardholder will spend”.
Some charges cannot go into a Visa estimate, since “The Estimated Authorization Request does not include any amount covering potential damage, theft, other delayed charges, insurance premiums”, and tips are excluded too.
Mastercard frames the same duty around consent: “A Merchant must inform the Cardholder of any estimated amount for which authorization will be requested and must obtain the Cardholder's consent to the amount before initiating the authorization request.”
Mastercard also gives UK examples of how to do it. A merchant can let the cardholder pick the preauthorisation amount on the terminal, or show it on a clearly readable sticker or notice at the point of sale.
Hotels can top up an estimate during a long stay. Mastercard lets hotel, cruise and car rental merchants ask for further authorisations as needed, and Visa allows an incremental authorisation once the first estimate no longer covers the bill.
The issuer may not stretch the hold past what it approved, and for hotel and rental transactions Mastercard's rule bars any hold above the authorised amount.
When several holds cover one stay, Mastercard tells the issuer to match them all to the final clearing record and release whatever exceeds the bill. Each extra hold must carry the first one's identifier.
Visa also bars estimated authorisations for some kinds of payment. Advance payments, instalments and recurring transactions are on that list, along with cash disbursements and quasi-cash transactions.
Damage charges follow a separate route under Mastercard. Its rule states: “A charge for loss, theft, or damage must be processed as a separate Transaction from the underlying rental, lodging, or other Transaction.”
That separate charge needs a stated reason, a reasonable estimate of the repair cost and the cardholder's authorisation before it is processed. The final repair charge cannot exceed that estimate.
How long does a pre-authorisation last under Visa and Mastercard rules?
For a hotel, both schemes allow about a month. Visa's table gives estimated authorisations at lodging, cruise line and vehicle rental merchants 30 calendar days from approval.
A card-present restaurant hold falls in Visa's general line of five calendar days. A merchant-initiated charge gets five days as well.
Mastercard counts the same month in a different way. In its Europe Region, an approved preauthorisation of a Mastercard POS transaction carries a chargeback protection period of 30 calendar days from approval.
That period is the time during which the authorisation protects the merchant from an authorisation-related chargeback, the dispute code Mastercard numbers 4808.
A final authorisation gets only seven calendar days. In that case the amount the business clears must equal the amount the issuer approved.
Maestro debit cards are stricter still, because Mastercard does not permit card-present Maestro preauthorisations in its Europe Region, apart from narrow cases such as fuel pumps and electric vehicle charging. Card-not-present Maestro holds get seven calendar days.
A long stay can outlast the hold itself. Mastercard says that once the protection period has expired, a new preauthorisation must be for the full amount rather than a top-up.
Teya's machines show such a hold as expired. At that point the business can no longer capture it and has to start a new transaction.
Top-ups behave quite differently in the two card schemes. Visa's rules state that “An Incremental Authorization Request does not extend the processing timeframes”, but Mastercard lets an additional preauthorisation extend the protection period.
One provider's guide, Teya's, says holds last between 1 and 30 days depending on the scheme and the business type, with the exact expiry shown on the machine. Teya charges the same transaction fees as for standard payments.
What is the card pre auth release time when a guest leaves?
The card pre auth release time starts with the business, because the schemes give it 24 hours to cancel what it no longer needs. Visa wants the unused difference reversed within 24 hours.
Here is a hypothetical example built only on those rules. A hotel that finalises a Mastercard bill below the held amount on Monday morning has until Tuesday morning to send the partial reversal, unless it clears the bill within that time.
Visa's table also covers a stay that never happens: if the booking is cancelled or the guest pays another way, the full reversal is due within 24 hours of that moment.
Mastercard's Europe Region rule is close, saying the acquirer or merchant “must submit a reversal message to the Issuer within 24 hours of” a cancellation or of finalising a sale below the approved amount.
Mastercard's version has one shortcut for busy tills. A partial reversal is not required if the clearing message goes within 24 hours of finalising the sale.
The customer's bank then has 60 minutes to release the held funds once it matches a Mastercard reversal to the original authorisation. That clock starts only when a reversal arrives.
Without a reversal, the hold sits until it runs out. Mastercard's rules state that “The Issuer must release any hold placed on the Cardholder's Account after the expiration of the message reason code 4808 chargeback protection period” at the latest.
First direct sets its own, shorter limit: “If the company doesn't take the funds, the authorisation will expire after 15 days (for a card authorisation made in the UK, including ATMs), or 5 working days for international authorisations.”
Card machine software can narrow the window further. Teya's guide warns merchants: “You can only void a transaction on the same day it was created.”
A guest who settles the final bill on a different card is the case to watch, because the first hold stays until the business reverses it or the hold expires.
How do tips work on a restaurant pre-authorisation?
With chip and PIN or contactless, tips cannot come later. Mastercard's rule says “any gratuity added by the Cardholder must be included in the authorization request amount and must not be added after authorization is obtained”.
Signature and key-entered payments leave some room: Mastercard allows a tip of up to 20% of the authorised amount to be added after approval. Above that, a preauthorised bill needs an incremental authorisation.
Visa sets its tolerance in a separate table. For restaurants in its Europe Region and several other regions, Visa lets the cleared amount differ from the authorised amount by up to 20% from February 2026.
That table carries an exception: the two amounts must always match for a transaction inside the European Economic Area, and elsewhere the rulebook names the UK separately from the EEA.
A UK restaurant should ask its acquirer which line applies.
Low-value holds carry one more UK rule from Visa. Its Easy Payment Service, or VEPS, covers small card-present payments, and a chip terminal may suppress the PIN for them.
If a card-present estimate starts below the VEPS limit without strong customer authentication, a check such as a PIN, Visa requires that check once a top-up lifts the total above the limit.
What do the rules leave unclear for UK businesses?
The rulebooks set maximum periods, not typical ones. We found no public figure for how quickly UK banks actually release holds, or for how often a hold outlives the stay.
Issuer practice varies inside the scheme limits, and first direct's 15-day expiry for UK authorisations is one bank's rule that another issuer can set differently.
Some of Visa's European detail sits outside its public rules. The rules refer European members to a separate processing document for some matters, and we did not read it, so our reading of the UK tip tolerance stays incomplete.
Provider guides and scheme rules do not always line up either. Teya lists potential damage among the hotel uses of a hold, yet Visa's rule keeps damage out of an estimated authorisation, and the guide does not explain the difference.
Provider limits differ again, and a void allowed only on the same day, as in Teya's guide, is one provider's product rule rather than a scheme rule. For now, Teya offers pre-authorisation only on its card machine.
A short note on your own case: the acquirer's merchant guide and support team can confirm hold lengths and void windows for your terminal, and an accountant can advise on how holds appear in the books.
What comes next for card holds?
Mastercard's global reversal rule widened on 1 July 2026. A merchant now also has 24 hours to reverse an authorisation once it, its acquirer or a service provider finds the original request was sent in error.
The update also brought new reason codes for reversals. The Europe Region version we read still lists only cancellations and lower final amounts, so a UK business can ask its acquirer whether the change reaches it.
Our view at the school is that the hold deserves the same care as the payment itself.
A hotel that names the amount at check-in, completes the bill on the same card and reverses the rest at checkout gives its guests little reason to ring the bank.
Task for this lesson: take one recent hotel or restaurant bill that used a pre-authorisation and write down four dates. Note when the hold was taken, when it was captured, when any reversal was sent and when the guest saw the hold disappear.