Why do they require credit card?

CiniO

In my experience, it's very difficult, or sometimes even impossible to rent a car or book a hotel without having a credit card.
It seems to be just those two.
For anything else debit card is perfectly fine.

Could someone explain to me, why do car rental companies and also often hotels require a credit card?

I understand in the old days of magnetic strip, when card terminals had no instant connection to data centre, and they couldn't verify if card holder has enough funds to pay with debit card, then credit card was a must for security deposit for car rental or hotel.

But in modern world, where anyone can do pre-auth the same on credit card as any debit card, what is the point in requiring credit card?

Kenno90

So say your staying in a hotel for a week. You use a debit card for pre-auth and you rack up a ton of charges. There is nothing stopping you from emptying your current account during that week and disappearing.

Then when the hotel tries to take the money they are owed, there is nothing in the account for them to take.

Even if the banks implemented something where the cost of the hotel or car is set aside from the beginning, it still wouldn't work because you can have additional expenses by ordering room service or damaging the car/hotel room. Leaving them out of pocket

brendan86

But is it not the same thing saying you dont want to pay to ring credit card company and report card lost/stolen so the hotel/car rental cant take payment?

Or can they force the payment even if card is cancelled which I doubt they can do?

If they cant force payment it doesnt make much sense to only accept credit card rather than debit also?

CiniO

Kenno90 wrote: »

So say your staying in a hotel for a week. You use a debit card for pre-auth and you rack up a ton of charges. There is nothing stopping you from emptying your current account during that week and disappearing.

In my experience, once pre-auth is done on debit card, then the amount of pre-auth becomes blocked, and can't be used for anything else or cleared out of the account.
So, f.e. if you have ?1800 on your accound, and car rental company would do ?1500 pre-auth for a deposit, then you'd be left with only ?300 available on your account until pre-auth is released or expired.

Then when the hotel tries to take the money they are owed, there is nothing in the account for them to take.

Even if the banks implemented something where the cost of the hotel or car is set aside from the beginning, it still wouldn't work because you can have additional expenses by ordering room service or damaging the car/hotel room. Leaving them out of pocket

But is it not exactly the same with credit card?
Hotel might ask for ?500 deposit, and they pre-auth that amount on your credit card.
You avail of various hotel services and end up with bill of ?1500.
There's absolutely nothing which could assure the hotel they will be able to charge your credit card for this ?1500.
You could have a credit card limit of ?500 in the first place, and they wouldn't be able to take a cent more....

So I still don't see a point.

SCOOP 64

Just paid the €30 annual credit card charge, but haven't used it for 5 years,
was just thinking this, why do i need it, but if i need to rent a car, so only reason.

Savman

You can rent a Car without a Credit Card, you just have to be able to deal with the authorisation hold. On one trip to the states (Honeymoon) I rented with Hertz from four different locations with Visa Debit.

It does no harm to sign up to the Gold Club of whatever your preferred franchise is.

Pretty much all Hotels everywhere take Debit so not sure why you're finding this "impossible"

purple_rose

SCOOP 64 wrote: »

Just paid the €30 annual credit card charge, but haven't used it for 5 years,
was just thinking this, why do i need it, but if i need to rent a car, so only reason.

I have a new credit card, a couple months old. I haven't used it yet. Would i still get this annual charge? I know a couple of years ago, you didn't get charged if it wasn't used, but I'm not sure if things have changed since then.

Marcusm

CiniO wrote: »

In my experience, once pre-auth is done on debit card, then the amount of pre-auth becomes blocked, and can't be used for anything else or cleared out of the account.
So, f.e. if you have ?1800 on your accound, and car rental company would do ?1500 pre-auth for a deposit, then you'd be left with only ?300 available on your account until pre-auth is released or expired.




But is it not exactly the same with credit card?
Hotel might ask for ?500 deposit, and they pre-auth that amount on your credit card.
You avail of various hotel services and end up with bill of ?1500.
There's absolutely nothing which could assure the hotel they will be able to charge your credit card for this ?1500.
You could have a credit card limit of ?500 in the first place, and they wouldn't be able to take a cent more....

So I still don't see a point.

I don't think most banks could do a pre authorisation on a debit card. I thought that functionality only exists as a generic matter on credit card processing g systems.

CiniO

Marcusm wrote: »

I don't think most banks could do a pre authorisation on a debit card. I thought that functionality only exists as a generic matter on credit card processing g systems.

I have few debit cards (issued by foreign bank), and you can do pre-auth on them.
Indeed though they are marked as Mastercard (not Mastercard Debit) so maybe that's the difference. Still it's written "debit" on the card, but card type is Mastercard (not Mastercard debit).

But leaving that aside, if most bank's debit cards can't be used to do pre-auth then why is that? Surely banks could allow to do pre-auth on them.

CiniO

Savman wrote: »

You can rent a Car without a Credit Card, you just have to be able to deal with the authorisation hold. On one trip to the states (Honeymoon) I rented with Hertz from four different locations with Visa Debit.

Was it Visa debit issued by Irish bank?
What do you mean by "being able to deal with authorisation hold" ?

Pretty much all Hotels everywhere take Debit so not sure why you're finding this "impossible"

In my experience, if you're booking online or over the phone, they want credit card for you booking deposit. They wouldn't accept debit card for that.

Savman

CiniO wrote: »

Was it Visa debit issued by Irish bank?
What do you mean by "being able to deal with authorisation hold" ?



In my experience, if you're booking online or over the phone, they want credit card for you booking deposit. They wouldn't accept debit card for that.

The Hold takes funds away until the amount is settled. Large Holds can severely disrupt a holiday budget.

You simply don't need a Credit Card for Car Hire or Hotel Bookings, I don't know what other way to say it.

Go onto Hotels.com, Bookings.com or try book a room with Hilton, Marriott etc. I guarantee you any major site or hotel chain will take your money any which way you give it to them.

coylemj

Savman wrote: »

You simply don't need a Credit Card for Car Hire ....... I don't know what other way to say it.

From seeing this being discussed here on multiple threads, it is not the case that every car hire company will accept debit cards. See below for hotels.

Savman wrote: »

Go onto Hotels.com, Bookings.com or try book a room with Hilton, Marriott etc. I guarantee you any major site or hotel chain will take your money any which way you give it to them.

It doesn't matter whether you're using a debit or credit card when booking with sites like booking.com or hotels.com because they make you pay upfront so they get paid one way or another. You may still have a problem when you check in at the hotel because most hotels require some form of 'security' against possible charges to your room and the preferred method is to lock an amount from your credit card credit spending limit. If it's a budget hotel that requires immediate payment for every service (e.g. drinks in the bar, meals in the restaurant) so you cannot charge anything to your room, not having a card to present for this purpose when checking in may not be a problem.

If it is a hotel that allows charges to your room and you refuse to give them a card when checking in, the worst that happens typically is that they will not give you a guest card to use to charge items to your room and they will lock or empty the minbar in your room.

purple_rose

Mr.S wrote: »

€30 Stamp duty is paid on all credit cards in April, regardless if you actually use the card or not.

You need to pay €30 duty as well to close the account as well.

Thanks, i just checked citizen information. You're right. The only time it's not paid is when you open an account, not use it and close it in the same period. That's what i was thinking of. The shower of robbing bastards.

Savman

coylemj wrote: »

It doesn't matter whether you're using a debit or credit card when booking with sites like booking.com or hotels.com because they make you pay upfront so they get paid one way or another. You may still have a problem when you check in at the hotel because most hotels require some form of 'security' against possible charges to your room and the preferred method is to lock an amount from your credit card credit spending limit. If it's a budget hotel that requires immediate payment for every service (e.g. drinks in the bar, meals in the restaurant) so you cannot charge anything to your room, not having a card to present for this purpose when checking in may not be a problem.
.

Hotels will take Debit at check-in and block €50-100 for incidentals. Possibly more for a longer stay.

The point still stands, it doesn't matter if it's Credit of Debit once the funds are there to cover it.

GreeBo

Mr.S wrote: »

€30 Stamp duty is paid on all credit cards in April, regardless if you actually use the card or not.

purple_rose wrote: »

Thanks, i just checked citizen information. You're right. The only time it's not paid is when you open an account, not use it and close it in the same period. That's what i was thinking of. The shower of robbing bastards.

/edit
For Credit Cards you pay either way, for Debit/ATM you only pay if used within that year.
Actually thats incorrect, you dont pay if you dont use the card.
http://www.revenue.ie/en/tax/stamp-duty/leaflets/stamp-duty-financial-cards.html

Any other exemptions?
There are a number of exemptions to stamp duty in relation to ATM cards, debit cards and combined cards:

If the card is not used during the year

coylemj

GreeBo wrote: »

Actually thats incorrect, you dont pay if you dont use the card.
http://www.revenue.ie/en/tax/stamp-duty/leaflets/stamp-duty-financial-cards.html

The exemption in the event that you do not use the card does not apply to credit cards. Look at the last quote in your post, it doesn't mention credit cards.

MagicBusDriver1

Credit cards are normally required for car hire. For example Hertz Dublin Airport,

https://www.hertz.com/rentacar/location/ireland/dublin/DUBT52

The following forms of payment are accepted when booking on the websites: most major credit cards, some debit cards* and the Hertz Charge Card (HCC).

However, you may opt to pay by other means at termination of rental, subject to specific terms and conditions being met.

* If you made your booking with a debit card, you will need to present the debit card and one or more credit card (depending on the vehicle group) when picking-up the vehicle.

Bob24

I don't rent cars, but I travel a good bit in Europe and Asia, and never had any issues with my debit card at any hotel (worst case scenario the will put a hold on a specific amount which appears as a pending transaction and reduces the available balance until the hold is released).

Samuel T. Cogley

How true this is I have no idea - but I was told by a rental location that there is an agreement that the total amount, even if it is over the credit limit, can be applied to the card, that's obviously not possible with a debit card.

Now it is possible to use a debit card for a rental - they usually charge a fair whack of a deposit/pre auth but, and it's a Vanessa Feltz sized but, some companies in some jurisdictions won't accept them, some rental locations won't accept them (they are typically franchises) even if some other will and some say they won't accept them then do accept them on the day.

+1 on never having had this issue with a hotel.

NewbridgeIR

A pre-authorisation on a debit card can stay for up to 10 working days. Can cause severe disruption as it blocks the funds - even if the bill is settled in the interim.

I now pay for my hotel stays upon arrival - in cash.