My customer transactions are in “withheld” status in the merchant service center. What does this status mean and do I need to take any additional step for the transactions to be approved?

I can share why the customer's payment is withheld, justinhaworth.

You'll see a Withheld from the Status column when there's an issue with the deposit. Select the arrow ▼ from the Fee column to review details.

You'll also receive an email from us with steps to fix the issue. If you didn't get one, check your email setting. 

Please refer to this link for instructions: Find out what to do if you can’t receive any emails from QuickBooks Payments. Then, add QuickBooks Payments to your contacts so you can receive messages from us.

The Merchant Service Center keeps a complete record of your payment activity from all of your QuickBooks products. You can check the status of all processed payments by following these steps:
 

1. Sign in to the Merchant Service Center.
2. From the homepage, select Activities & Reports and then Deposits.
3. Choose the date range in the Dates field.
4. Select Search.
5. This lists all your daily deposits, when we put them in your bank account, and the totals. 

Once everything looks good and we deposited the payment, your money is on its way.

I'm also adding this article to learn more about letting customers pay their invoices online: Take and process payments with QuickBooks Payments.

Let me know if you have additional concerns about the status of the payment. I'll be right here whenever you have follow-up questions about it.