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Why do I need a credit card to rent a car?
It's a common point of frustration for travellers, but one that is almost unavoidable – you need a credit card to rent a car. This strict requirement can be a major road block with very few ways around it. So why is it that car hire companies insist on a credit card?
Credit cards vs debit cards
What you need to know
Unlike a debit card, a credit card can act as a safety net for the rental company. It allows them to block a deposit amount as insurance in case something goes wrong during the rental. The deposit – which is not withdrawn from your account – gives them the ability to easily collect repair fees or any outstanding traffic charges. Companies prefer credit cards because it proves to them you're not a financial risk; their costs will be covered as they can recover part or all of the deposit if needed.
With a debit card, the company cannot pull money from a bank account if it has insufficient funds. There is also no way to block a specified amount on a debit card. So even if you have enough money in your account to cover the deposit, the car hire supplier would have to completely withdraw the funds, and then refund the money later on.
FAQs
What is the benefit of using a credit card for me?
Using your credit card gives the car hire supplier more security but it provides more security to you as well. A credit card may supply you with extra insurance and help you reclaim costs in the event of a dispute.
Also, if the company had to withdraw money from your debit card and then refund it, you could lose out on transaction fees and an unfavourable currency exchange rate.
Are there any suppliers that accept debit cards?
While there are some car hire companies that accept debit cards, they may not accept them at all of their locations and you may need to agree to other additional requirements. Often in order to rent a car without a credit card, you must pay more for extra insurance coverage at the counter, even if you already have your own third party insurance. This coverage can be very costly but should mean you won't need to leave a deposit.
Do I have to pay for my rental and collect it using the same card?
No, you do not have to collect your car using the same card you paid for it with online. Therefore, it is possible to pay for the car using a debit card and then leave your credit card details with the supplier upon pick-up.
Do I have to pay for my rental and collect it using the same card?
No, you do not have to collect your car using the same card you paid for it with online. Therefore, it is possible to pay for the car using a debit card and then leave your credit card details with the supplier upon pick-up.
Whose credit card can I use?
The credit card must be in the main driver's name, as they are legally responsible for the car during the rental period.
Additional things to remember
Deposit
A security deposit is blocked from your account, not actually debited. But you must still ensure that you have a credit limit large enough to cover the deposit amount.
Ts&Cs
Read the fine print or get in touch with the company to be sure of their rules on using credit and debit cards.
Cards
Pre-paid cards are rarely accepted by rental companies and in places like the US, you may have to pass a credit check to hire a vehicle when using a debit card.
Policies
The same company may have different policies at different branches, even within the same country. So check the details of the specific location you are hiring from. For example: Enterprise will accept debit cards at Heathrow Airport but not at their London Victoria station branch.
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Other articles you might be interested in
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The ultimate guide to car hire excess
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The ultimate guide to car hire deposits
