Pre-authorization is often used in hotel scenarios. Either at the booking stage or during check-in, the merchant can pre-authorize the customer's credit card. This guarantees that there are funds available to pay for any charges incurred during the hotel stay, such as the cost of room service or other amenities.

A hotel pre-authorization (or "hold") is a temporary freeze of funds on your credit or debit card to ensure you can cover the room cost and potential incidental charges. When you check in, the hotel "pings" your bank for a set amount—typically the total room rate plus a daily security deposit (often $50–$150). These funds are not actually "spent," but they are deducted from your available credit limit. Upon checkout, the hotel "captures" the actual amount spent, and the bank releases the remaining hold. In 2026, digital payment systems like Alipay and Apple Pay have streamlined this, but it can still take 3 to 7 business days for your bank to reflect the released funds. To avoid issues, travelers are advised to use a credit card rather than a debit card for check-ins, as a debit hold physically removes cash from your checking account until the bank processes the release.