Guaranteed reservation of a hotel room is a reservation that is paid in advance. If a hotel, motel or a similar type of business offers guaranteed reservation service to consumers, the hotel is required to have a room available when the cardholder arrives (until checkout time the next day). The consumer, for his or her part, must cancel a confirmed reservation before 18:00 on the arrival date at the hotel (merchant’s local time). Failure to do this will allow the hotel to charge the consumer’s card a no-show charge equal to one night’s lodging.
The following procedures will be in force at check-in:
- If a cardholder calls a hotel and requests to book a room using a credit or debit card, the hotel’s representative must explain the terms of the guaranteed reservations service, and specifically inform the cardholder the following:
- An authorization check will be made at the time of arrival.
- The specifics of the cancellation procedure that the cardholder must follow to avoid being charged a no-show charge equal to one night’s lodging.
- The representative takes the cardholder’s card account information and confirms the room rate and location. Then the cardholder is issued a reservation confirmation number. It is recommended that the hotel also confirm the reservation in writing, advising the cardholder of his or her confirmation number and cancellation procedures.
- If a cardholder who has made a reservation using a bank card calls the hotel to cancel the reservation within the agreed upon period, the hotel must cancel the reservation and issue the cardholder a cancellation number that is a verification that the reservation has been canceled. It is also recommended that the hotel confirm the cancellation in writing advising the cardholder of the cancellation number.
- If a cardholder who has made a reservation using a bank card arrives within the specified period (until checkout time the next day), the hotel must provide a room. If the hotel is unable to provide a room, the hotel must provide at no additional charge a comparable room for one night, transportation to the other lodging and a three-minute domestic or long distance phone call, whichever the cardholder deems necessary to advise of a change of location.
- Before the cardholder’s expected arrival, the hotel must prepare a registration card and assign a room number on that card.
- If the cardholder does not cancel and does not stay at the hotel, the hotel may bill the cardholder for one night’s room rate (a no-show charge). The following procedures should be followed when billing the no-show charge:
- Complete a transaction, filling in the cardholder’s name and card account information, date of no-show, assigned room number and merchant identification, and write the words “guaranteed reservation / no-show” in place of the cardholder’s signature.
- Follow your usual authorization procedures.
- Providing the account is under the floor limit, or authorization has been given, deposit the no-show charge in the usual manner.
- Retain the actual no-show registration card, reflecting the assigned room number, for six months from the date the sales ticket is deposited.
- If the account number used to guarantee the transaction that results in a no-show was unidentifiable as to a specific card issuer or was fictitious, your processing bank will bear the liability. The acquiring bank also bears the liability if the transaction is identifiable to a specific card issuer but is not identifiable to a specific account number within the card issuer.
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