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I'm wondering if it makes sense to split the difference by allowing airlines to block the amount on the passenger's credit card upon reservation, but only charg

I'm wondering if it makes sense to split the difference by allowing airlines to block the amount on the passenger's credit card upon reservation, but only charge them upon check in. This way, the risk of non-payments or problems processing the payment on the check in counter would be minimized.

ginko 4y ago
Plane tickets are often bought months ahead of time. Does it make sense to block an amount of credit for that long?
- mschuster91 4y ago
  It's not even possible. Most card networks let pre-authorizations expire after 7 or 30 days [1], you'd need new laws for that. Additionally, this will be a massive headache for business travelers that use their private credit cards - usually, you'd book a flight and file for reimbursement at the employer, which you then use to pay down the CC bill. Now when you book a larger amount of flights, suddenly you may end up with your CC running into its limit because all the flights are technically still "on hold" and can't be paid off. [1] https://docs.adyen.com/online-payments/adjust-authorisation https://docs.adyen.com/online-payments/adjust-authorisation
Roark66 4y ago
In Europe credit cards are less popular. Most people I know use debit cards with a special "virtual" debit card for Internet purchases. In this situation blocking a certain amount on your card is almost functionally equivalent to taking a payment in advance. The customer has to transfer all the money to their "virtual" card account and the money is blocked. The only time when blocking is better is when it comes to the refund, but that too can be botched by airlines by for example automatically completing the payment at a time of supposed check-in. A much better way would be to pay an advance. Let's say 25%.
- m2fkxy 4y ago
  pre-authorisations are a thing on debit-cards, hotels and gas stations e.g. work with them a lot.
  - nottorp 4y ago
    They are but the money can take weeks to get back to your account. While on credit cards a hold is canceled instantly.
danielfoster 4y ago
A credit card is all that is needed indeed. Hotels already support pay-at-check-in without resorting to blocks.
- nibbleshifter 4y ago
  Credit cards aren't particularly popular in Europe, and especially not in Germany. There is a way to do preauths on debit cards though, iirc by blocking a certain amount temporarily.
  - danielfoster 4y ago
    That's correct. I'm just pointing out that hotels already support pay when you check in.

ginko 4y ago

Plane tickets are often bought months ahead of time. Does it make sense to block an amount of credit for that long?

mschuster91 4y ago
It's not even possible. Most card networks let pre-authorizations expire after 7 or 30 days [1], you'd need new laws for that. Additionally, this will be a massive headache for business travelers that use their private credit cards - usually, you'd book a flight and file for reimbursement at the employer, which you then use to pay down the CC bill. Now when you book a larger amount of flights, suddenly you may end up with your CC running into its limit because all the flights are technically still "on hold" and can't be paid off. [1] https://docs.adyen.com/online-payments/adjust-authorisation https://docs.adyen.com/online-payments/adjust-authorisation

Roark66 4y ago

In Europe credit cards are less popular. Most people I know use debit cards with a special "virtual" debit card for Internet purchases. In this situation blocking a certain amount on your card is almost functionally equivalent to taking a payment in advance. The customer has to transfer all the money to their "virtual" card account and the money is blocked. The only time when blocking is better is when it comes to the refund, but that too can be botched by airlines by for example automatically completing the payment at a time of supposed check-in. A much better way would be to pay an advance. Let's say 25%.

m2fkxy 4y ago
pre-authorisations are a thing on debit-cards, hotels and gas stations e.g. work with them a lot.
- nottorp 4y ago
  They are but the money can take weeks to get back to your account. While on credit cards a hold is canceled instantly.

danielfoster 4y ago

A credit card is all that is needed indeed. Hotels already support pay-at-check-in without resorting to blocks.

nibbleshifter 4y ago
Credit cards aren't particularly popular in Europe, and especially not in Germany. There is a way to do preauths on debit cards though, iirc by blocking a certain amount temporarily.
- danielfoster 4y ago
  That's correct. I'm just pointing out that hotels already support pay when you check in.