The whole truth about accepting credit card payments for your vacation rental.
All vacation home owners who are renting out their vacation homes will have to deal with this question. Should I accept guest payments via credit cards? Myself having been in the vacation rental business for 14 years have had to make a decision about this. Before I go into detail about how I’ve dealt with this payment issue, I’d like to share valuable information that I came across from Rick Smith.
Rick Smith, President of SmallBizAssist: http://www.smallbizassist.ca/decided after his own struggles with credit companies, to read and study the small print and offer advice to business and the general public of how to make the most of your credit cards and how to stay out of debt.
According to Rick here are 5 Questions to ask your credit card company and for you to consider in order to protect yourself:
1. Calculate your bottom line fees after subtracting debit/Interac fees (IDP and IDP Network Fees). If the total bottom line cost is more than 2.1% of your credit card sales you may be paying too much (percentage depends on volume, with who, how, when and where your do transactions)
2. Do you have 2 statements one for debit/Interac and one for credit card transactions? This is not necessary and you are probably paying unnecessary fees.
3. Do you have more than one account? Some Processors and ISOs will sign businesses up to more than one account when it is not necessary. When it is necessary they should be linked and you should get only one statement more than one usually means extra fees.
4. Does your money usually go into your bank account the next day? Some Processors take their time with deposits, with the exception of weekends or bank holidays money should be in your account the next day (subject to a cut off time of day).
5. Do you have more than one deposit per batch and do your fees come off the deposits? This causes extra bank fees and is a nightmare for bookkeepers. Deposits should match your batch report and their fees should come off once a month separately.
6. Have you received a notice of a “change” in the way fees are calculated of similar wording in a statement or separate letter from your Processor. They need to give you the details of any changes and you have 90 days from the date the details are received to cancel without penalty according to the “Code of Conduct for the Credit and Debit Card Industry” in Canada and the USA.
For myself with my vacation rental, I’ve been able to do business never having to process a credit card, I know it’s difficult to believe!! What I do is ask my guests to send me either an email bank transfer or a personal or business check. For last minute guests, I ask foreither personal checks or cash. Of course I ask for their credit card details in order to hold their reservations, I can always go back and charge their credit card, that’s my blanket of security.