10 Payment Pitfalls You Face in Vacation Rental Property Management
From deciphering confusing statements to dealing with chargebacks, you most likely have experienced the challenges of being a vacation rental property management professional.
Fortunately, we’ve got tips on how you can avoid the ten most common payment pitfalls.
1. Confusing statements and billing
If you’re using different providers for your gateway and processing, you may start to feel like you’re up to your eyeballs in billing statements and extra fees for every transaction. Using the same provider for your gateway and processing helps reduce confusion by offering services like straightforward statements and consolidated billing, which can often save you money.
2. Sneaky processing fees
Many ISOs and third party processors offer low teaser rates, but the next thing you know, you’re sifting through statements of surcharges and realize your effective rate is much higher than promised. Find a provider who can give you flat-rates, with no pricing tiers, no fluctuating rates and no hidden surprises.
3. Too few payment offerings
By limiting payments to only paper checks, wire transfers or only a few credit card types, you are limiting the ability for your guests to pay efficiently. Give your guests the option to pay with their Visa, MasterCard, Discover, and American Express. eChecks can also be used to collect an advance payment, and save you money in fees.
4. DBA (doing business as) names
If your DBA name is different than what you use to advertise your business, your guests may not recognize your charge on their statement and might issue a chargeback. Keep things consistent by making your DBA the same as what you have advertised.
5. Unclear policies
To avoid unnecessary chargebacks, clearly list your policies on your website and rental agreements. Highlight the fine print and require guests to sign the dotted line to acknowledge their review. Regularly review your agreements to avoid loopholes. Credit card issuers are always adjusting their chargeback policies - you should be adjusting your rental policies too.
6. Unbalanced accounts
Nobody wants to search through pages of old statements to track down a payment. Utilize your processor’s reporting tools to review daily batches and transactions. Balance your accounts by using a reconciliation report. Your accounting department will thank you.
7. Endless chargebacks
From a guest issuing a chargeback because the pool looked larger in the pictures than reality, to a cardholder claiming they never made the charge to begin with, you have probably seen it all when it comes to chargebacks. Follow chargeback best practices to safeguard yourself from fraudulent and non-fraudulent chargebacks.
8. Refund options
Finicky customers always seem to ignore your well-designed cancellation policy. Instead of risking a chargeback, you might be able to turn the reservation around by rescheduling or offering a refund. Responding to complaints in a timely manner and being flexible might prevent a cancelled reservation and a frustrating chargeback claim. Add an apology to that refund, and your customer satisfaction can increase even more.
9. Charging for damages without notice
Any charge not previously agreed upon is considered an unauthorized charge and may cause a guest to initiate a fraudulent chargeback. Fraud chargebacks are often the toughest to win. Avoid automatically charging the card on file for damages or other necessary fees after a guest’s stay. Ensure you are covered in these events by protecting your business with travel insurance.
10. Not knowing when to ask for help
Sometimes the solution is recognizing that you do not have a solution – and then asking for help from reputable resources. Work closely with your reservation software and merchant processor and regularly attend industry conferences for networking and industry knowledge.
Learn how Kigo can help you simplify the vacation rental payment process.
This content was provided by YapStone.