Hard to believe for us, but goHenry has now been in business for nearly 6 months. The time has gone by in a flash! In this time we have been really pleased to see all the parts of the account that are working so brilliantly, and been able to make changes to the bits that perhaps weren’t as brilliant as we thought!
One of the aspects of the goHenry accounts that we think is the most brilliant is the 'real time’ transactions, enabling your child or children to see any purchases on their statement immediately. No other pre-paid card service can provide this and when the goHenry app for IOS & Android is released shortly, they will have their updated balance every time they spend. To be able to provide this information we are using the retailers request for an authorisation, this ensures that the child cannot spend more than their available balance. Unfortunately there are a few circumstances where having this fantastic real time information can cause some confusion.
As adults, when we use our debit or credit card the retailer taking payment will swipe our card and at that point the payment will quite often be immediately authorised and taken from our account. However, many online merchants choose to use a two step, authorisation process. The purchase amount is pre- authorised by your credit or debit card provider, the amount of the purchase is blocked from the balance you have available to spend and taken in to account when you make further purchases that day BUT the funds are not actually taken at that point. Under normal circumstances, goods are despatched and the retailer manually completes the payment process, the pre-authorisation/blocked amount is automatically released and everyone is happy. You, the customer will only see one single financial transaction on your account.
The problem arises for our goHenry children when, for some reason, the retailer does not cancel the pre-authorisation. The amount stays blocked and that part of the child’s balance will not be available to spend until the authorisation expires 'naturally’. Unfortunately, this can take anything up to 14 days. For children with limited funds and generally small balances this can cause a real issue. This might be the case if the retailer has been unable to fulfil an order your child has made. If your child should find themselves in this situation, we would recommend that you contact the retailer and ask them to cancel the outstanding authorisation.
The most common scenario for funds being blocked happens when purchasing from some of the most popular websites for children. iTunes, xBox, Amazon and many other online merchants take a small amount to verify that a card being used for payment is genuine, Apple for instance take £1.58 (equivalent to $2.00) when a new card is used on an iTunes account. Unfortunately, they are not always very good at releasing the authorisation, instead leaving it to expire. As already mentioned, this can take up to 14 days, again fine if you are an adult, not so fine if you only had £2.00 on your account in the first place and were hoping to buy a track from iTunes.
One slightly different situation, but one that we would urge you to be aware of is Amazon Prime, we have seen several accounts now where children have signed up to a free trial of Amazon Prime and have completed their free one month trial. Amazon will attempt to take payment of the £49.00 annual fee every single night once the fee falls due. You may wish to check with your children if they have been purchasing items from Amazon and check if it was their intention to sign up to the Amazon Prime, if not then you may wish to contact them to cancel the service.