Different Payment Methods In The Hotel Industry Money Essay

The kinds of repayment accepted in hotels have altered over time. Most hotels still accept a number of methods of repayment mainly to be able to provide a service with their clients and generate additional cash flow through exchange. A large number of independent vacationers now use some type of credit or bank card. Hotels are now very acquainted with a variety of cards, often with 'dual' ownership (e. g. the HCIMA have their own version of Barclaycard). There will always be lots of other deals within the hotel regardless of the method of repayment. These transactions will often be paid through lots of other methods. Upon departure, guests can settle their account in one of a variety of ways:

Cash

Foreign currency

Cheque

Traveller's cheque

Foreign cheque

Debit card

Credit card

Fee card

Ledger payment

In working with each one of these methods of repayment, the hotelier must examine the impact of three major factors: liquidity, security and value.

Liquidity

It is advantageous to the hotel if the accounts is paid in cash, as the hotel can immediately use the money to get goods itself, or loan provider the amount of money and earn interest onto it. Repayment by ledger, however, will need a lot longer - perhaps just as much as several months may go away before the money can be re-used available.

2. Security

The two attributes to security are the following:

The likelihood of forgery or fraud by each of the repayment methods.

The subsequent risk of theft after the hotel has the money. Payment by cheque is a greater security risk than accepting profit Payment of the bill. It would be difficult to track stolen

Currency if the hotel was robbed and cheques would unlikely is considered as they don't be of any value to a thief.

Worth

The total amount of money the hotel receives in repayment will not be the same atlanta divorce attorneys case. Handling charges, percentage and delays in payment will definitely cost the hotel money. But because of

The extra fee, accepting payment in foreign currency will usually imply that when guests use this method of repayment, the hotel profits an extra revenue. Stand 9. 1 implies that the profitability of the hotel may be damaged by all of the repayment methods used

by the guests

Method of

Payment

Security

Liquidity

Worth

Cash

The threat of loosing cash through

theft is high, but the threat of forgery

is low.

Immediate

100 %

Foreign

currency

The risk of loosing overseas currency

through robbery is high, however the risk of

forgery is low.

1 Day

102 %

Cheque

Cheques carry a higher threat of fraud

e. g. non-payment. If security

checks are carried out, risk of theft

is low.

3 Days

98 %

Traveller's

cheque

Safe approach to payment if control

checks are completed properly.

Low threat of forgery.

4 Days

98 %

Debit Card

Safe method of repayment if control

checks are completed properly.

Low threat of forgery.

3 Days

99 %

Credit card

Safe approach to payment if control

checks are carried out properly.

Low risk of forgery

3 Days

96 %

Charge card

Safe method of payment if control

checks are completed properly.

Low threat of forgery

3 Days

96 %

Ledger payment

If creditworthiness is established

before hand, this can be a safe method of

payment, however there's always a

risk of non-payment of accounts

30 Days

98 %

Voucher (e. g.

travel agent,

If creditworthiness is established

before hand, this is a safe method of

payment, however there is always a

risk of non-payment of accounts

60 Days

89 %

Table 9. 1 Security, Liquidity and Value of the various ways of payment

Cheques

Payment by cheque use to be one of the most frequent methods of repayment. It reflected the decrease of repayment method in cash in recent years. Cheque guarantee credit cards guarantee the repayment of the cheque for an decided amount (usually Ј50 or Ј100). But there are many simple rules that needto be adopted.

The assurance provided by cheques guarantee cards are:

Only one cheque can be used per transaction

It can be agreed upon in the existence of the cashier

Your banker code on the cheque and the promise card agree

The greeting card number is written on the opposite area of the cheque

The greeting card hasn't expired.

A bank does not assure to honor a exchange where a merchant account of is paid by issuing two cheques of Ј50. The transaction is altered to a cash one by placing the card number on the back of the cheque. The client will not have the ability to stop the cheque later. It is crucial that the cashier pieces the customer sign the cheque and then compares to the signatures carefully as to

establish their similarity. Listed below are factors that need to be look into when handling cheques guarantee cards.

1. Code Number

The bank sorting code quantity must buy into the code of the issuing cheque.

2. Credit card Number

The card number is written on the reverse of the cheque by the agreeing to cashier. It does not correspond to any other number on the cheque.

Expiry Date

The card will never be valid if it is outdated.

Signature

The personal must be checked out against the signature written on the back of the cheque. The greeting card should be reviewed to make certain that the personal panel is not tampered with.

Crossed cheques are now mostly issued and for that reason have to be paid into a bank account. With the signature of the payee at the trunk, it can be reassigned to an authorized. In the event where a alternative party cheque is returned, the hotel must contact the original drawer of the cheque to acquire settlement. It is for this reason that hotels do not admit alternative party cheques.

Date

When acknowledging a cheque, the cashier should check lots of details, one of the main being the particular date. A cheque which has a date in the foreseeable future onto it (a post-dated cheque) will not become valid until that night out. A cheque more than six months old (stale) is no

longer valid.

Crossing Cheques

The two most significant guidelines about crossing cheques are the following:

A/c payee: this means that the cheque can only just be paid into the account of the individual nominated. It can't be assigned to a third party. This is great for cheques delivered by post.

Not to go over xxx: this is crossing establishes a maximum

Value to the cheque and guards against scam by which makes it more difficult to improve the amount payable.

Traveler's Cheque

Traveler's cheques (Fig 9. 4) are issued in fixed denominations by major lenders, travel agents and now building societies throughout the world. The customer will need to purchase them (before departing home) utilizing their own money, or in the currency of the united states being been to. These cheques need to be authorized when purchased. The serial statistics are then known by the issuing lender cashier. A service demand of 1% is generally paid to the lender by the client. It

covers insurance against damage or robbery. The issuing company will pay back the customer within a day if the traveller's cheques be taken. It is because of this that traveller's cheques are found to be much more secure than currency. It is vital that the cashier should watch the guest sign and date the cheque when agreeing to these cheques. Should there be any doubt or irregularities about the signature, the client can be asked to to remain the opposite of

the cheque. Proof identity can even be verified by asking the guest to produce their passport before receiving the traveller's cheque.

Debit Cards, Credit Cards and Demand Cards

Debit Cards

The common option to cheques nowadays is debit credit cards such as Turn and Delta. Just how that this works is comparable to that of cheque whereby the remarkable sum is considered directly from the

client's account. However the transfer is through an electronic point-of sale and no cheque is necessary. The cashier and the payer will get a slide notifying them of the details of the repayment. Normally, this is the same card that can be used to guarantee a cheque or withdraw money from a cash point. Bank BANK CARDS Visa and Gain access to will be the two major lender credit cards in the united kingdom. These credit cards are usually released free of charge and customers do not need to to pay for any annual registration. The customer uses the credit card to get goods and services by putting your signature on a sales voucher for the total amount of the account. The card company will send a statement to the

customer with information of all deals of the month before. The customer has the choice to pay the total owing or only a percentage of it. The others of it may be paid over a period of time. As the credit cards constitute a form of credit, the lowest payment is set by the federal government. The client will get a personal borrowing limit which should not be exceeded in virtually any a month. Visa is an internationally regarded name, and while most countries use yet another name (e. g. Barclaycard in the united kingdom; Carte

Bleu in France), all cards take the name 'Visa' and tolerate the distinctive blue, white and rare metal stripe logo (Fig. 9. 5).

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