Do Hotels Take Prepaid Cards? What to Know Before Booking

While hotels generally accept prepaid cards for payment, understanding the specific procedures involved before booking a stay is important. Acceptance varies among establishments, and their finite balance influences the transaction process. Knowing how hotels handle payments and authorization holds can help ensure a smoother experience for travelers using prepaid cards.

Hotel Payment Processing Basics

Hotels use authorization holds to guarantee financial coverage for a guest’s stay. An authorization hold is a temporary reservation of funds on a payment card, not an actual charge. Hotels typically place this hold at check-in, verifying the card’s validity and the availability of funds.

The amount of an authorization hold often includes the estimated room charges plus an additional sum for incidentals. These can include mini-bar purchases, room service, or property damages. A hotel might place a hold for the nightly rate plus an extra $50 to $200 per night for such costs. This hold acts as a security measure, allowing the hotel to cover any charges not included in the initial room rate without needing to process a new transaction.

Once a guest checks out, the hotel finalizes the bill, and the actual charges for the stay and any incidentals are processed. The difference between the authorized amount and the final charge is then released back to the cardholder.

Using Prepaid Cards for Hotel Stays

Prepaid cards can be used for hotel stays, but their functionality within the hotel payment system differs from traditional credit or debit cards. Because prepaid cards have a finite balance and no associated credit line, hotels may be cautious about accepting them for the initial authorization hold. Some hotels might not accept them for reservations or deposits, preferring a standard credit or debit card. Other hotels may accept prepaid cards but require the full estimated cost of the stay, plus an incidental deposit, to be available at check-in.

When a hotel places an authorization hold on a prepaid card, the specified amount becomes temporarily unavailable for use. This impacts the card’s usable balance, as held funds are deducted from the loaded value. If the hold amount, including incidentals, exceeds the card’s balance, the transaction may be declined, requiring an alternative payment method.

The release of authorization holds on prepaid cards can sometimes take longer than with credit cards. While holds typically clear within a few days after checkout, it can take up to 7 to 10 business days for the funds to become available again on a prepaid card. This delay is due to the processing times of the card issuer and the hotel’s banking institution. Guests should be aware that even if no incidentals are charged, the held amount might not be immediately accessible.

Preparing for Your Hotel Stay with a Prepaid Card

Thorough preparation is important when planning to use a prepaid card for a hotel stay. Before booking, confirm the prepaid card has a sufficient balance to cover the entire anticipated cost of the stay, including the room rate, taxes, and an additional amount for potential incidental charges. Hotels typically require an authorization hold that can range from $50 to $200 per night for incidentals, so having extra funds is advisable.

Contact the hotel directly to inquire about their specific policy regarding prepaid cards and the exact amount of their authorization hold. This proactive step can prevent issues at check-in, as some hotels may have restrictions or prefer other payment methods for the initial hold. Confirming the hotel’s policy beforehand ensures alignment with their payment requirements.

It is also advisable to have a secondary payment method, such as a traditional credit or debit card, available as a backup. This provides flexibility if the prepaid card encounters an issue with the authorization hold or if unexpected charges arise. Review the terms and conditions of your specific prepaid card regarding authorization holds and the typical timeframe for fund releases to understand how your balance will be affected.