Preventing fraud and stolen IDs or credit cards is a concern of any online business, and with no exception, of vacation rental businesses. Both the seller and the customer should be cautious not to fall into scammers’ hands. The renters have the legitimate fear of arriving at an empty or non-existent rental in exchange for the money they pay for their stay and want to safeguard against such a situation. And the owners should think of strategies for their property management security to prevent fraudulent schemes.
What Are the Warnings Related to Property Management Security?
If this is your first experience running an online business, you might be expecting scammers behind nicely-written emails and enquiries. When you get an enquiry to rent your vacation rental or serviced apartment, you may always consider the chance of receiving the information of a stolen credit card which ends up in chargeback and the loss of income. However, from vacation rental owners’ point of view, there are some signs to look out for and call a halt to fraudulent actions. Some of the signs are listed below; if you come across these, you should think twice before moving forward.
Text with Poor English
This could be from someone who is not fluent in English and is the case with many instances of fraud. As one of the main signs of a fraudulent scheme, this can be generated by some software, sent to you in a random order.
Vague Description of Your Property
A vague description means it could be an email sent to many people waiting for one to respond. If the email is referring to a room while you offer a full house, or if you are dubious about their real intent and think they don’t seem to know what exactly they are applying for, be cautious.
Too Ideal a Renter
If it seems too good to be true, you should always consider scammers behind the scene who are making up a story that suits your dream. Also, if they are telling stories and giving you too much unnecessary information of who they are or what their travel story is, watch out.
Last minute bookings
Last minute bookings might be real stories, but are also a very common and popular way to scam the owners. Make sure to carefully check all the details.
Asking for Other Ways of Payment
Stick with your payment method as this is your safe ground. If someone asks you to use other ways such as cash, cheque, bank wire, etc., something unfortunate might lie ahead.
Property Management Security: The Hassle of Security Deposit
While you as a vacation rental manager prefer to take security deposits to prevent the destruction of your property by problematic guests, not all channels offer payment security. In addition, taking security deposits remotely always increases the risk of fraud and chargebacks. Fraudulent chargebacks happen when a guest claims that someone else has used their stolen credit cards or data. This claim ultimately ends in refund regardless of the reason behind the case unless you can show that the card owner consented to the transaction.
You might have thought of meeting your guest at arrival to take the deposit by cash or debit card authorisation using a chip and pin machine. However, this requires a lot of time and arrangements which makes it almost impossible to consider, especially during the COVID-19 pandemic.
Property Management Security: How to Prevent Chargebacks
To prevent chargebacks, make sure to do the following:
- State your cancellation and refund policy clearly.
- Ask for guests’ IDs.
- Get your terms and conditions signed.
- Upload full descriptions, as well as proper photos for all your listings.
- Although it is not that convenient for you and your guests, use chip and PIN methods on arrival.
- You can also use 3D-secure ‘payment’ links which require the verification of the card from the guest.
- Be aware that security deposit pre-authorisation expires after 7 days if you use Stripe payment processor.
How Can a PMS Provide Property Management Security?
Keeping an eye on every single booking request might not be the best strategy to take care of your property management security, considering the associated workload of operating a vacation rental or a serviced apartment. Here is the right place where Property Management Systems (PMSes) step in. A PMS should arm you with the necessary tools to combat security issues.
Property Management Systems facilitate the payment process for vacation rental managers and every other short term rental owner.
- One way is to integrate the PMS you use with a payment gateway. For online payments, a payment gateway transmits card payment data to the payment processing network and then returns the response to the website, showing whether it is approved or declined, to authorise the transfer. Using a payment processor means keeping guests’ card data out of the PMS, which in turn keeps you on the safe side as a vacation rental manager in the case of a system breach.
- To prevent getting stolen credit cards, you might find 3-D Secure Links useful. This is the safest way to take card payments since the identity of the person who is paying has to be the same as the card holder. Using these links helps prevent unauthorised card use, preventing fraudulent chargebacks.
- For the first time in the vacation rental industry you can set the security deposit pre-authorisation period yourself, for example from two days before arrival till one week after departure. Zeevou has made this possible through its Booking Confirmation Process.