When using your prepaid gift card at restaurants, salons, hotels, or food delivery services, you might encounter some difficulties due to pre-authorization charges. Understanding these charges can help you avoid declined transactions and frustration.
Common Establishments with Pre-Authorization Charges:
- Restaurants
- Hair Salons
- Gas Stations
- Hotels
- Car Rentals
- Cruise Lines
How Pre-Authorization Charges Work:
- Addition Charges: An extra amount, usually around 20%, may be automatically added to your bill to ensure sufficient funds for tips or additional charges.
- Declined Due to Insufficient Funds: If your card does not have enough balance to cover the purchase amount plus the pre-authorization charge, the transaction will be declined.
- Refund of Extra Charges: The additional charge is typically refunded to your card's balance within 7 to 10 business days if no extra amount (like a tip) is added to the bill.
- Merchant Unawareness: Most merchants are unaware of these additional charges and cannot prevent them.
Recommendations for Specific Establishments:
- Restaurants, Hair Salons, Food Delivery Services:
- Request Lower Authorization: Ask the merchant to process the card for 20% less than the total amount to account for the pre-authorization.
- Refund Timeline: If no tip is added, the extra 20% is usually refunded within a few days.
- Hotels and Car Rentals:
- Extra Charges: Expect additional authorization charges, which may take up to 30 business days to be refunded if the purchase is successful.
- Alternative Payment: Use an everyday credit or debit card to make reservations and use the gift card to pay the final bill.
- Gas Stations:
- Avoid Pay-at-Pump: Swiping your card at the pump may result in a pre-authorization of up to $200. If the card balance is insufficient, the transaction will be declined.
- Pay Inside: Pay the cashier directly for an amount no greater than the available balance on your card. Inform the clerk that it is a prepaid gift card and needs to be authorized for the exact amount.
Additional Information:
- Handling Authorization Holds: Once a merchant places an authorization hold on your card, the funds will not be available until the merchant releases the authorization.
- Travel Merchants: Hotels, cruise lines, and car rentals can maintain authorization holds for up to 30 days.
- General Tip: Use your everyday credit or debit card for reservations and use the gift card for final payments to avoid lengthy authorization holds.
For more information and support, please refer to the articles in this section or contact our customer service team for assistance.
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