Credit card authorization forms are filled out by the customer, and give you - the merchant - permission to charge the card even if the card itself is not physically present. This is especially important for online purchases, if the customer is purchasing a subscription or there is any other reason why you would need to charge the credit card on a regular basis. By filling out the credit card authorization form, the cardowner is expressing his or her knowledge and agreement that the card will be charged at certain times.
Anytime you accept online payment by credit card, you are taking on a number of risks, including that the customer will deny that they authorized the charge and will request a chargeback. If they’ve signed the credit card authorization form, you are protected against this risk, saving you the hassle of fighting with the credit card company to get the funds that are owed to you. These forms are also beneficial for customers so that they do not have to re-submit their payment information every month or each time a payment is due.
What information do you need to request for Credit Card Authorization Form
There is fairly standard information needed for the form, and there are many credit card authorization form templates that you can find online, depending on the specific use as described in more detail below. The general information you should request from the cardholder includes:
- Cardholder details - full name, billing address and phone number
- Credit card details - type of card (i.e. Mastercard, Visa, American Express, etc.), full number, expiration date and CVV security code on the back of the card
- Merchant details - your business’ full name, address and contact information
- Authorization statement - this is the statement that authorizes you to charge the card. It should be customized depending on your business and the type of transaction, and should include whether it’s valid for a one-time charge or recurring.
- Cardholder signature - the customer’s signature is what makes the document valid, and it should also include the date.
How to fill out a standard Credit Card Authorization Form
Filling out the credit card authorization form itself is very simple. The customer must just provide the information requested (other than your business details which you can supply) and sign the document. Then you keep the document on file so that you can access the information when it’s time to charge the card.
It’s best practice to put the form online as part of a secure website. If that is not possible, you can either have the customer fill out the form in person or print and sign the form and send it via email or fax.
Why do you need to use Credit Card Authorization Forms?
There are two main reasons to use credit card authorization forms: to mitigate risk of chargebacks and for convenience. When a customer requests a chargeback, it sets off a chain of events that are time consuming and can become expensive (especially if the chargeback is successful). If your business sees a lot of chargeback requests, credit card companies may decide to no longer work with you. By using credit card authorization forms, you will always have proof of permission to charge the card, preventing fraudulent chargeback attempts. In addition, credit card authorization forms are convenient and time-saving. If you and your customer know that the card will need to be charged on a regular basis - a gym membership or subscription service, for example - filling out the form once is much more convenient than collecting payment details each month.
When do you need to use Credit Card Authorization Forms?
Credit card authorization forms should be used in any situation when the physical card will not be present at the time of charging. There are many examples of when this would be necessary, including online purchases, monthly gym memberships, school payments, magazine subscriptions, and more. These forms could also be used for charitable donations should someone choose to make a recurring donation.
Credit card authorization forms also come in handy if you need to take an advance deposit, say for a hotel room or piece of expensive equipment, and then charge the remainder at a future date. In some cases, the authorization form allows you to put a hold on the account and charge the card later. This is often what happens with car rentals, for example - the card is only charged once the car is returned and the correct amount owed is calculated.
Main types of Credit Card Authorization Forms & Templates
Each business is different and there are many scenarios in which you might need a credit card authorization form. You may want to consider all of the possible situations that are relevant to your business, and then keep different credit card authorization form templates on hand for each scenario.
Following is a list and links to templates of some of the most commonly used credit card authorization forms.
One-time-use of Credit card authorization form
A one-time use credit card authorization form is to be used when a customer is making a one-time purchase and gives permission to charge the card just one time. Generally, the only information required will be the card details (name, number, billing address, security code) and a signature.
Recurring credit card authorization form
A recurring payment credit card authorization form is needed if the card will have to be charged more than once. Gym membership, utility bills, car payments, and other ongoing charges can be automatically charged to an individual’s credit card after s/he has signed the authorization form. Generally these charges will take place at the same time each week, month or appropriate interval until the transaction is canceled.
Hotel Credit Card Authorization form
Hotel credit card authorization forms are often used when a guest checks into a hotel and puts a credit card on file that can then be charged for incidentals or other items that the guest charges to the room. These forms can be customized to include things like limits to what can be charged, such as not allowing items from the mini-bar to automatically be charged to the card.
Airline Credit Card Authorization form
Credit card authorization forms for airline tickets are most often used if a passenger is using someone else’s credit card to pay for their ticket, such as a parent buying a ticket for a child. The form must include the name of the passenger as well as the cardholder and authorizes the airline to charge the cardholder.
Car Rentals Credit Card Authorization forms
A car rental credit card authorization form often includes a clause explaining that the final charge will be determined at the end of the rental period. This is to be able to account for the total mileage driven and/or any damages to the car based on the terms of the rental agreement. The authorization form gives the car rental company permission to charge the card the appropriate amount.
IELTS Credit Card Authorization Forms
IELTS credit card authorization forms are for candidates who wish to sign up for the IELTS English language test. It includes information about registering for the test, and could be customized to be used for other test registrations.
Employee Credit Card Authorization Forms
Some companies give certain employees a company credit card that can be used for business expenses. An employee credit card authorization form is used when an individual uses such a card, for example, to order lunch for the office or to purchase plane tickets or car rentals for business trips. This form generally lists the type of purchases that are approved by the company.
Blank Credit Card Authorization Forms
A blank form can be customized so that you can create your own credit card authorization form templates. If none of the suggestions above suit your needs, this is the option for you.
Anyone who runs an online business - or really any business that accepts credit card payments - should be familiar with credit card authorization forms. By ensuring that your customers fill out these forms when necessary, you are protecting yourself against the risks of chargebacks or fraud. You are also providing your customers (and yourselves) with an added measure of security and convenience that will ensure their loyalty and keep them coming back for more.
Using credit card authorization form templates such as the ones linked above will save you time and effort. You’ll always have the right credit card authorization form on hand to provide to your customers and make sure all transactions go smoothly.