Federal law requires that banks hold you harmless from certain perils. Your risk for the $3000 computer is limited to $50.
Money is not held until cleared. Credit cards are a cash flow business and settle very quickly, but contract terms allow the credit card to recover chargebacks or other losses by nabbing future cash flows.
My guess is the issue that triggered this is that a big transaction is a risk as a chargeback may not be recoverable as there is no baseline level of activity. Or… they suspect that the merchant is getting a cash advance outside of the terms of the contract.
Other than the lack of process to resolve the hold, I always reserve judgement on stuff like this as you never get the full story.
Money is not held until cleared. Credit cards are a cash flow business and settle very quickly, but contract terms allow the credit card to recover chargebacks or other losses by nabbing future cash flows.
My guess is the issue that triggered this is that a big transaction is a risk as a chargeback may not be recoverable as there is no baseline level of activity. Or… they suspect that the merchant is getting a cash advance outside of the terms of the contract.
Other than the lack of process to resolve the hold, I always reserve judgement on stuff like this as you never get the full story.