A holdback refers to a portion of a merchant’s card-based transactions withheld by payment processors as a reserve against potential chargebacks and fraud.
In the travel industry, holdbacks are used to protect against the financial risk of chargebacks, cancellations, and disputes, which can be common in high-ticket transactions like travel bookings.
While holdbacks provide financial protection, they can also impact cash flow for travel businesses, particularly smaller operators. Negotiating lower holdback percentages and maintaining good transaction records can help manage this challenge.
- Holdbacks mitigate financial risks from chargebacks in travel.
- They can affect cash flow and require careful management.
- Good transaction history can help reduce holdback rates.
Felloh assists travel companies in managing holdbacks by providing transparency and real-time insights into held funds. By tracking the status of holdbacks and offering clear reporting, Felloh helps businesses better manage cash flow and understand when funds will be released. This reduces financial uncertainty and allows companies to plan more effectively. Felloh’s platform also ensures that holdback policies are fair and clearly communicated, helping businesses navigate the complexities of withheld payments while maintaining operational efficiency.
Felloh’s automatic reconciliation feature matches and verifies transactions from three payment methods—card payments, Open Banking, and bank transfers—ensuring that every transaction is tracked and settled accurately with your back-office systems.
