Pending Transactions


#1

So Starling is being an absolute God-send when it comes to seeing transactions reflected immediately in my account balance; but how exactly does it deal with pending transactions?

Let me give you an overview of something I’m going through with my legacy bank at the moment (with some fabricated figures) - and see if Starling would handle things any differently:

  1. On Thursday, I placed an order with an online retailer for £540 - this immediately shows as a pending transaction and my available balance is £460

  2. I cancelled the order 30 minutes later due to an issue with the item I ordered - my available balance remains at £460

  3. I want to re-place the order ASAP so I ask the retailer to release the money - they say that they haven’t physically taken it and it’s my bank that is holding it (a process I am familiar with)

  4. I ask the bank to release the funds who process the request but say it can take 24 hours - my balance is back up to £1000 after this

So my question is this: is the whole ‘waiting 24 hours’ a legacy bank ‘thing’ and something that could be done immediately using Starling’s house-built full stack bank, or is it just industry standard?

TL;DR: Can Starling release the funds from a pending transaction (when the money won’t be taken) faster than my legacy bank?


#2

i think it’s standard to wait a least 24hrs to return the money it has to do with fraud


#3

When I updated my card on Apple ICloud the pending transaction was held for 7 days. FWIW.


#4

Not so much an answer as to piggyback on your question with one of my own that might help us both get an answer.

I’m a new account holder with Starling and haven’t got my card yet, but I do use Monzo so i suspect everything works the same way when it comes to payments. Here’s my scenario.

I ordered something from Amazon last night using my Monzo card and everything went as it would when I used my HSBC Advance card previously. However, where with HSBC the available balance would alter at some point in the next day or two and the actual transaction would show up some time between now and Christmas, I got an almost instant notification from Monzo to say it had been charged. Again, I suspect Starling will behave the same way.

So my question is how is this actually working in the background, and why is it able to do it when HSBC apparently can’t? Is it simply telling me of the new pending transaction and labeling it as processed and it is still taking x hours/days before it really goes through, or is Monzo really processing things quicker?

Short version: Is Monzo/will Starling just fudge the reporting to make it look instant, or are things actually happening any quicker?


#5

Any reply to this?


#6

Can’t say for Starling, but Monzo show pending and cleared transactions pretty much the same way (if you click on item it’ll say pending).

Monzo or starling have no real input on the transaction times as far as I know. The retailer decided when to authorize, and when to send the transaction for settlement. In a smaller shop, auth is on entering the transaction, settlement starts when end of day is ran on card machine.

All banks will have to authorize in a second or so, and there will be tight timescales when it’s presented for settlement too

So as far as I can work out Monzo (and probably Starling) notify and show the transaction as soon as authorized, whereas legacy banks might show it as pending (and there’s maybe a batch update to update inline banking with these), but don’t show fully until settled. How long each step takes is independent of the bank involved, when it’s shown isnt

Worth bearing in mind that auth amount and charged amount may not always match up. Pay at pump auths for £1 and charges what you filled up with, foreign transactions show with exchange rate in day if with(but charged with rate on day of settlement)


#7

You’re correct there. Both Monzo and Starling show auths in the app. Monzo currently shows more information such as reference number and pending status where Starling doesn’t have this information leading some people to think it is the final collected payment and then confusion.


#8

I’d like to see a way to differentiate between pending and cleared transactions on the list without having to click onto each to see the status. E.g. different colour / font / a ‘P’ against authorisations that haven’t settled yet.
I don’t think the way the reversal shows is great either - because it doesn’t show at all. I have been watching the £1:58 authorisation that iTunes makes when you swap your payment card. It stayed for a week, then I got a push notification saying the merchant had reversed it. It has now simply disappeared from the transaction list. I think a corresponding credit against the original pre-auth debit would make a lot more sense. If I hadn’t been consciously watching it to see the behaviour I likely wouldn’t have a clue what that week old authorisation had been.
Not so much of an issue for trivial amounts, but as a general principle I don’t think entries should just disappear without trace.


#9

Hi Andy

These points have been raised before and rightly so.

The pending / authorised issue is one of ease-of-use, whilst the reversal point is more about assurance. Disappearing transactions can’t be the best way to resolve these reversals.

@ben.chisell, can the team review these please?


#10

Thanks Graham,

I did a search and couldn’t find a thread, thought this one fitted rather than create a new post :slight_smile:


#11

Quite right. These important issues are often wrapped up in wider conversations. Good that you picked it up. :grinning:


#12

The lack of an audit trail concerns me though. I don’t like the idea that a transaction can just be removed without trace.

This is different to foreign spending, where the value can change when the rate adjusts. That’s where there’s value in knowing where the transaction is still pending (without clicking into the detail).


#13

Sure. I’ve flagged these to the team.


#14

It’s interesting because with a Legacy Bank, you never get to see the transaction in the first place, you just see your available balance go down and come back again. I definitely think with Starling that your should be able to see the transaction and the reversal in the feed.

Not sure I’d want Pending transactions to be more obvious in my feed but then again I don’t really have many authorisations/reversal type transactions. I think with this and some of the other suggestions around feed (lets us the Apple term of) ‘complications’ is that users should be able to toggle them on and off depending on how cluttered they want their own feed to be.


#15

This is not really the same as the reversal credit. Pending transactions are subject to change (think foreign transactions especially) and cleared transactions are fixed. They are all shown in the feed - which is the bonus - but there’s no quick way to tell what has actually left my account vs what is still to come.


#16

PS - this has a bearing around overdrafts too. Say I have £500 cleared balance, and spend £1,000 which becomes a pending transaction. My balance says -£500
In fact it’s not, it’s still £500 until the transaction processes. If I pay in £1,000 before the payment goes out I’ll never really have gone overdrawn, despite the balance in the app telling me otherwise.
My legacy bank - FD if it matters - shows me my actual balance, the sum of my pending transactions and the available balance. So it’s not always the case that legacy is ‘behind’. They, in fact, give me more info than Starling about the real state of my account.


#17

Ah OK. None of the legacy banks I’ve ever used have made that differentiation and leave it to the customer to try and work out what’s what!


#18

Don’t get me wrong, I like the detailed ‘pending’ vs the ‘sum of pendings’.
There’s just a difference between ‘you’re about to go overdrawn, do something about it’ - and being able to see quickly in the feed what transactions are still to hit vs those that already have - and ‘you’ve gone overdrawn, here’s the charge’


#19

Actually Barclays show pending transactions. They have done for over a year, and they know show it in the app.


#20

I’m with Halifax and they show pending transactions collapsed down in your transaction list. You can click to expand to see details of them so they don’t clutter. They also show your actual balance and the available balance (real balance minus pending transactions). I really like this way of doing it as it’s clear what’s going on.