Do hotels only need pre-authorization to swipe their cards?

Staying in a hotel requires hotel pre-authorization, that is, freezing a part of the credit card limit, which is equivalent to the room rate and hotel deposit.

When you check out, the hotel needs you to swipe your card. At this time, swiping the card is to swipe the hotel room rate and other consumer expenses. At the same time, the card will be swiped again to cancel the previous pre-authorization, which is to unfreeze the credit card limit.

Pre-authorization refers to the behavior that the cardholder requests authorization from the card issuer in advance through the POS machine when spending and settlement are not completed at the same time in hotels, hotels or leasing companies.

Extended data:

Credit card pre-authorization refers to the transaction in which the card issuer or its agent confirms the permitted frozen amount before the deduction of the special merchant. Pre-authorization will occupy the credit limit of the card. When the customer settles the pre-authorization, the pre-authorization will be cancelled. Within 30 days of pre-authorization, if the customer fails to settle the account, the pre-authorization will be cancelled.

To put it simply: pre-authorization of credit card means that the merchant freezes some funds before the cardholder spends, and after the cardholder signs, the merchant can formally deduct this part of funds.

For example, if you go to a hotel, first tell the hotel how many days you will stay, and the hotel will freeze the expenses needed for these days from your credit card. After you check out, the hotel will use your card for pre-authorization, so that the actual consumption amount will be deducted from your card and the hotel will receive the money.

The reason for this is to ensure that the money in the cardholder's credit card is enough for current consumption.

Advantages of pre-authorization: it can avoid the phenomenon of running orders as much as possible. If the guest leaves the hotel without checking out after completing the pre-authorization, the hotel can apply to UnionPay for completing the pre-authorization, and provide the guest consumption documents and pre-authorization documents. So UnionPay can transfer money from the traveler's card to the hotel account.

Credit card pre-authorization is a new transaction method. Generally speaking, it is a way of advance payment, which can be understood as "deposit". When consumers book hotels or air tickets with credit cards, banks will first freeze part of the funds in the credit cards as a "margin" for merchants' consumption. After the consumption is completed, the merchant can officially deduct this part of the funds after the cardholder signs and confirms.

However, if the consumer fails to confirm the pre-authorization in time, the merchant can apply to UnionPay for the completion of the pre-authorization before the bank can transfer the funds to the merchant's account.

References:

Encyclopedia-credit card pre-authorization