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Getting your cancellation or No Show fee

 Card details are held on both our Channel Manager's secure site and on the site

When a guest cancels, inevitably (especially after the arrival of the "Can we cancel for free?" letter) when the cancellation goes through, the card is usually declined by the POS machine. In short - we get shafted.

The only way around this is to check each guest a month before arrival and take your cancellation fee by pre-authorisation. This will need a valid card to do this. No money is taken, it just reserves that money for a confirmed authorisation should you need it.

This raises several issues:

1) The guest is notified of your pre-authorisation by their bank and we have had hysterical emails accusing us of taking money a month before they arrived etc. You basically get off on a wrong foot with your guest.

2) You might find the transaction is declined - i.e. there are insufficient funds on the card or the card is a fake or some other unknown banking reason. This means that you can ask to get new card details in 24 hours otherwise you can cancel the booking and open the room for resale. You could lose a genuine customer who has not responded to his email - because it was missed in the hundreds of emails he receives and you lose a sale and may not actually resell the room.

3) The Pre-authorisation is accepted - all is OK. Only issue here is the card could be someone else's card (Daddy's card and Jim Bob Junior on arrival pays on a different card or by cash - meaning you have blocked someone's card for an amount for a month) This is why we do it so we are ending the calendar month on the day of arrival.

The main problem is you can only set a pre-authorisation for 1 month, so checking the card on booking might show it is valid, but 5 months later when they fail to turn up, your pre-authorisation has expired and you have no claim on the card and the card declines.

We have not really resolved this headache. At the risk of sounding politically incorrect, 99% of bookings from North Africa turned out to be fake. They want a letter showing accomodation details to support their visa and they never turn up. I say 99% because we had 1 guest from Libya who was genuine - cannot say the same for Egyptians, Moroccans, Somalians, Tunisians and other Libyans. Sad - but a truth.

We therefore only do our checks on guests coming from outside the EU and also ask for passport details "To send to the Central Visa Unit". We also say we will take 30% of the full fee as a pre-authorisation to secure our cancellation fee. As if by a miracle, we do not get applications from North Africa anymore.

This leaves those customers from within the EU that book and do not show up plus post card details that do not work. Obviously we could take a deposit - but this has an unacceptable effect on our sales, we would be at odds with local competition who do not take such deposits.

If anyone has any ideas how to cope with these I would be eternally grateful!

4 Replies

Thuild - Your …

Dear Akwador,

I guess you've replied to your own questions.

I simply do not pre-authorize and I do not receive Visa application bookings (luckily). However I did have a few people dodge cancellation fees with invalid cards (or no funds, etc.), these were of course locals.

My foreign guests are all perfectly fine with their payments.

I guess whatever you're doing now is the best you can do. It's not really possible to weed out everything.


Zsolt -

10 months ago

Thuild - my post was meant as a problem and solution as we saw it. Other solutions welcome!

We do get cancellations/no shows from EU and Eastern European guests where the cards turn out to be invalid.

I really think that should take some initiative in validating card details - but I was told by one of their staff that all they can do is ensure the numbers meet the correct format

10 months ago

Do you use Payments by

10 months ago
Le Balcon des Jasses

No, do it self, buy a card reader, and connect to your Bank, its cheap. charge 3%, far to much.


10 months ago