Hospitality

Why are Lodging/Auto-Rental merchants different?

A lot of merchants and customers are unaware that Lodging and Auto-rental companies will have different requirements for credit card processing. That is due to the fact that these merchant types allow for credit cards to have extended authorizations. When you stay at a hotel, you aren’t fully charged, but the authorization “sits” on your card, until the hotel completes the sale. You could stay for a week, or more!
Therefore, the card companies such as Visa/MC/Discover/Amex, recognize that penalizing a lodging merchant for how they do business doesn’t make sense. As a result they’ve created a unqiue program that’s designed only for lodging/auto-rental merchants, so that these merchants can authorize a credit card, but not “capture” the final sale until many weeks later.