Payment System in Hotel Industry

What is payment system?     

    Payment system is uses a financial system that supports the transfer of funds from suppliers, a savers to consumers or they are called borrowers and from payers to payees, usually through debit and credit exchanges between financial institutions. It consist of paper based of mechanisms for handle the checks and drafts, and paperless mechanisms such as electronic funds transfer to handle electronic trading transactions and it called the payment mechanisms.

Type of Hotel Payment 

There are several types of payment options that available. The availability of a certain types of payments depends on the provider of hotels and suppliers as well as a specific booking of code.Such as  guarantee, deposit, or prepayment is a fee that may be required to book a hotel reservation before the guest stay in hotel.

     Guarantee is charges that are not made to credit cards. On the other hand, card number are held against cancellations that violate  the cancellation policy of the hotel.

    Deposit have main two types such as credit cards and check. Credit card is charges made to credit card that usually for stay per night. If the reservation is canceled, the deposit will be canceled to the supplier. Next, check is has standardized deposit handling with check forms for hotel reservation. In both requests and reactions, when a check is used as a deposit, the data is sent and returned in guarantee. Lastly, Prepayment, payment is required at the time of booking for some or all of the hotel's accommodation at the time of booking. If the reservation is canceled, the amount of the refund varies according to the rules associated with the prescribed booking code.
     Not all the hotel need a credit card or deposit guarantee. Typically, the hotel will guarantee a room for a certain arrival times, such as 6.00 pm. If the traveler does not check in with a guarantee period, the room will not be held for them.

Method of Payment in Hotel Industry

Hotel is a business organization which is runs just for making a money. The hotel earns money especially by selling a rooms. So, this is the major responsibility of front office staff to collect  the room payment from guest properly. Usually, the guest pay during their registration and when time of check out.

    There are several methods are widely used as  methods of guest payment in the hotel industry.

Cash payment - Some guests has  prefer to pay a room charges for cash. The guest staying for a shorter have such as a inclination. They do not expect to extend their in home credit by shopping or having a meals at the hotel. If he want to extend his credit, the front office staff may be collect be his credit card or politely ask him to settle his account as soon as possible at the time of his o her long purchase or uses of any facilities. If guest wishing to pay cash then at the time of registration, front desk staff must obtain full room rates, taxes and expected amount of uses like room phone, room service and food service to avoid fraud. If any guest do not wish to pay the expected amount at the time of registration then he will be charged and will have to pay every time he or she service or uses from the hotel.

Credit card payment - The current payment y credit card has become the most common payment method. Among the well known brands are American Express, Visa, Master Card, and Citibank. The staff gets a card at the time of registration and has a trace. In all hotel, there is a computer system where the staff can know whether the card is valid or not with enough money. That is called Card Approval. The computer automatically calculates that expected amount to be charged by calculating the room rate and the total of accommodation amount.   

Pay through personal checks - Some hotels allowed such payment methods while other have a strict policy on this payment method. Personal check verification have the same process as a credit cards. With the issuing bank, the funds to be protected are validated. For the private check-in hotel requires the following details such as guest driver license, address, phone number and contact details. This should be written on the back of the check. One thing to mention is that tour inspectors and certified inspectors do not need approval because they are removed exclusively by exchange  of payments when they are issued.     

Example of personal check

 Direct billing - Direct billing arrangements are made between the guest or company and the front desk staff with guest's arrival. The guest will need to sign a bill upon check-in and check-out. A staff only review the guest's credit application and check whether the bill exceeds the limit or not. Usually, hotels offer this type of method to their regular guests or who represent any company that has a contract first. Bill will be sent to the guests in their office or other address after they stay in the the hotel.

Advantages and disadvantages 

There are show three payment that can we identified their advantages and disadvantages such as cash,checks and credit cards.

Advantages of Cash :

•  Direct money, except by taxes.
•  There is no cash transaction fee such as credit card.
•  Minimize the bookkeeping which mean less stress and less complexity.

Disadvantages of cash :

• Money in the drawer can be tempting for some stolen worker.
• Money at the location increases the risk for theft not just employee but criminal as well.
• Require so much time to withdraw money from bank.

Advantages of checks :

•  Some customer prefer paying by check instead of bringing cash.
•  Check can be sending by the email for payment and invoice.
•  Easy to bring the check everywhere.
•  Check can now be electronically processed at point of purchase such as credit cards but they are more less costly to process in most cases.

Disadvantages of checks :

• Checking account can be frozen, empty or non existent.
• May cause the cases of invalid check .
• Check take the time to write,process and clear the payment.

Advantages of Credit cards :

• Accepting credit card increase cash flow.
• Credit card transaction are deposited directly into the account.
• Credit card can also be used when emergency.
• May save money because can take advantages of sales.

Disadvantages of Credit card :

• Credit cards can add another level of difficulty to bookkeeping and receiving credit cards can be an additional monthly expenses in most cases.
• Credit cards come with risk such as charge-backs and fraud.
• High interest and increasing debt

Benefit of the Electronic payment system 

• Can refill the mobile by yourself
• Can do anything online reservation,shopping anywhere and anytime
• Can book transportation ticket by sit at home with e-payments without any turn
• Can use a credit card to make bill online payment
• There is no risk of theft and loss, it cannot be robbed by any pirate
• Do not need to bring any cash with,can utilize any transaction via e-payment from your mobile

Disadvantages of e-payment

• E-payments are the currency you do not see, so you spend more without temptation
• More scared of fraud because any hacker can hack the bank account and fly the entire money within a minute of your account.
• It requires internet usage. If internet connection fails, it will cannot be able to make any transaction from online account.

E-commerce payments system

• Credit card
• Debit card
• Electronic Fund Transfer (EFT)
• E-money

Three ways technology makes payments easier for hotel guest

    Technology has made the everyday aspects of everyday life easier, and now consumers are using new and alternative technologies to make payments for goods and services easier. Hotel can attract more guests and make payments be easier if they use innovative technology to accept new and alternative payment options. Understand what guest want and how to help make their payment be easier.

1.The guests can have a multiple payment options

Hotel should accept various payment options when someone book a room online and when someone pay in person. Most hotel now accept Visa, Master card for online and in store transaction. There are some of the easiest ways for travelers to pay the accommodation fee, and receiving them that can help the business appeal to a large audience.

2. The guest can check-in and check-out so easily

The offering check-in and paperless payment options at the hotel's lobby can also facilitate payment processing for guests. This self service option is similar to the kiosk that has been implemented by the airport, allowing tourist to receive their flight information immediately and without the help of employees. 

3. The guest can pay faster with mobile payment

With consumers becoming more dependent on mobile technology in every aspect of their lives, mobile payment initiated by customer is a growing trend that is witnessing the hotel industry. Mobile payments can offer hotel guests a convenient and convenient way to pay when, how, and where they want without having to wait in long lines.

     The conclusion is there are many payments that we have know and learn. It's about most of the payment systems described above offer a secure way directly related to payment transaction in the financial system. There have several payment method that can be used such as cash, credit card, personal check and direct billing. Electronic cash scheme such as Visa, and PayPal offer users the ability to pay retailers and other users on the internet as well as on highways, by phone and at home. Ideally, the solution should be an agnostic payment method because different payment methods provide different benefits in certain types of transactions.So, there have many technology that make the payment process become easy.

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