Every time a customer swipes, inserts, or taps their debit or credit card, it requires authorization. A successful authorization implies that a bank account or line of credit has sufficient attainable value that can be set aside for purchase until it is fully processed and the transaction is complete.

If there are not enough funds available to complete the purchase, then the transaction will be declined. The rate of successful transactions help to calculate the authorization rate or auth rate. But what are auth rates, and why should merchants care about them?

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