Hotel payment processing for check-ins, phone bookings and deposits

How do card payments work at a hotel?

Hotel payment processing covers every card charge a stay creates: a guarantee or deposit at booking, an authorization at check-in, the final folio at check-out and, sometimes, a charge that turns up after the guest has gone. Motels, inns and bed and breakfasts run the same way, and vacation rental hosts share the deposit and cancellation questions. Because nobody knows the bill until check-out, Visa lets lodging merchants authorize an estimate and add to it during the stay (Visa).

Our guide to hotel credit card processing covers each step with the rules behind it.

How do check-in holds and incidentals work?

Authorize the expected room charges plus a set incidental amount at check-in, then charge the real folio at check-out and release the rest. Visa's best-practices guide asks for an estimate based on the actual stay, not an arbitrary figure, and says to tell the guest it's provisional (Visa). If spending passes the estimate, add an incremental authorization; a second full one leaves the guest with two holds. For lodging, Visa says to complete the sale within 30 days of approval and reverse any unused amount within 24 hours of check-out.

Take a three-night bed and breakfast booking at $140 a night: $420 in room charges plus a $50 nightly incidental allowance makes a $570 authorization. The guest spends $35 on extras, so the inn settles a $455 folio and reverses $115 the same day. On a debit card, that $115 is the guest's own money until the issuer releases it, so don't wait. More in our authorization hold guide.

How can a hotel avoid no-show and late-charge disputes?

Show the cancellation policy before the guest books, log every cancellation, and check the log before you charge. On a guaranteed reservation, Visa's developer documentation describes a no-show transaction: a penalty charged under your cancellation policy (Visa). Where hotels slip is charging a guest who did cancel: Visa's dispute guide lists a canceled guaranteed reservation billed as a no-show among the common causes of "credit not processed" disputes (Visa). Ask your acquirer how large a no-show charge may be before you set the amount.

For a charge that missed the folio, Visa's term is a delayed charge, run after the stay and the original payment (Visa); post it promptly with an itemized receipt. If a guest disputes anyway, answer with the documents that match the claim, such as the policy they saw, the folio and the signed registration card, before your processor's deadline; Mastercard says merchants usually get 20 to 45 days from notification (Mastercard). Our chargeback representment guide walks through it, and Clearo provides chargeback management tools for the response.

How Clearo helps hotels and rentals

Clearo handles what a property takes at the desk, over the phone and on its own website, with one dedicated rep and no cancellation fee if you leave. As an authorized reseller, Clearo supplies front desk terminals from partners such as Clover and Helcim, and which hold features you get depends on the partner terminal, so ask before you choose. If your property management system or booking engine processes cards itself, ask its provider which processors it supports before you plan a switch. Our PCI compliance support helps retire paper habits, and a free statement review shows what your card-present and keyed charges each cost today.