Microsoft Help Documentation:
Hold
Mark Hold to place the vendor on hold. If you place the vendor on hold, you can’t issue or apply payments for the vendor using the Payables Transaction Entry window, the Payables Manual Payment Entry window, or the Print Payables Checks window. You still can enter, post, and apply transactions other than payments for the vendor. If you unmark Hold, the hold is removed and you can issue payments to the vendor.
Placing a vendor on hold isn't the same as making a vendor inactive. You might find it helpful to think of inactivating a vendor record as a permanent change that reflects you no longer do business together, while placing a vendor on hold usually is a temporary change to the vendor's status. If you inactivate a vendor record, you can’t enter transactions of any kind for the vendor. If you place the vendor on hold, you can’t make payments to the vendor but you still can apply vouchers and post transactions for the vendor.
In addition, you can place individual transactions on hold for vendors who aren't on hold. If a transaction is on hold, you can't apply documents or make payments to the transaction, but other transactions for the vendor are unaffected.
Thanks
Sandip