The concept of Locked Funds is really simple. Every Order that is processed deducts funds from your Account. However, most Orders typically take some time to get processed. The process of executing an Order consists of several steps. There is a chance that the steps may fail and the Order does not get processed. Therefore, we deduct funds from your account only at the last step after the Processing is complete, and the Order has been successfully executed.
However, in order to prevent the possibility of your account not having funds at that time, when the Order is processed successfully, we lock the amount of funds required for a particular Order, while it is processing. As soon as the Order Processing steps are complete the Locked Funds are either deducted from your account or the lock is removed depending on whether the execution of the particular requested action was successful or not.
There are also times when the process of executing a particular action of an Order takes several days. Some requests may take 5-10 days to get processed, like domain name Transfers. We would in this case lock funds required for a successful completion of the request at the beginning of the request, as soon as it is executed. Once the Order is executed, Successfully we would deduct these funds from your account. If the Order fails we would credit the Locked Funds back to your account.
For example, if there is an Order executing in your account which is likely to take 5-10 days, and your purchase price for the Order is USD 10, we would then lock USD 10 out of your available balance and begin processing this Order. If the Order is processed successfully, we would deduct this USD 10 from your balance. If the Order fails, we would simply remove the lock on the USD 10.
Basically this means that when you pay us for an Order, we do not utilize those funds immediately. We lock the funds and begin processing the Order. If the processing fails, then we release the lock and the funds are again available in your Account for you to use against anything else.
You can check out the complete list of Locked Funds for all your Orders which are currently in processing by clicking My Billing -> Locked Funds within your Reseller Control Panel. This list shows you the Orders for which funds have been locked from your account, and the quantum of funds locked for that Order.