What is the definition of Prepaid Rate in the hotel industry?
The word Prepaid Rate, refers to paying for the stay at a hotel in full at the time of reservation, rather than at entrance or exit from the hotel. Paying the prepaid rate usually can come with hefty price reductions from 10% to 25% off the BAR (Best Available Rate) – which can guide to large cost savings if you plan in front.
To accept a prepaid rate in common you have to book premature, roughly 3 days in advance. The only disadvantage of the Prepaid Rate is, that it is not bendable – meaning that cancellations will consequence in a fee, sometimes even in not getting anything back from your innovative reservation. It is also not able to alter the date or regulate the booking, after having received the prepaid rate. Further conditions might apply depending on the hotel.
If the guest does not show up for the original reservation date, the reservation will in general be cancelled devoid of the ability of receiving a repayment or credit for the future.
In common a pre-paid rate is split from other promotional rates and therefore cannot be joined in order to accept a greater discount. Some days may not even allow a prepaid rate, due to the fact that the hotelier in such elevated demand that most rooms sell at upper rates than the prepaid rate – such days are known as Black Out days.