Increasingly, credit card companies are offering programs to help merchants deal with no-shows - customers who fail to cancel reservations they've decided not to use.
Hotels and motels have long used reservations with a two-way guarantee - that a room will be awaiting the customer and that the customer will show up to claim the room. Now such programs seem to be gaining popularity in other industries, too.
In January, Visa announced such a reservation-guarantee program designed for the car rental business, and American Express said it developed a similar program.
Restaurateurs also jumped on the bandwagon.
For the past several months American Express has been testing a guaranteed reservation program in 35 restaurants in about 20 cities.
The idea behind the program, said Lloyd Wirshba, general manager, restaurant industry for American Express, is to "obligate the consumer" to notify restaurants when they are not going to make use of reservations they've made.
"We are not interested in putting the charge through," said Gordon Sinclair, owner of Gordon Restaurant of Chicago, which is participating in the test. "We just want people to cancel" if they won't be showing up.
The fee for no-shows who fail to cancel an American Express guaranteed reservation ranges from $10 to $25 and up to $300 for large parties.
Mr. Sinclair calculated that Gordon Restaurant loses $900,000 annually in lunches and dinners because of no-shows.
While consumer advocates say such fees are just another way to get money from cardholders, they are not particularly concerned about the issue.
Ruth Susswein, executive director of Bankcard Holders of America, a McClean, Va.-based nonprofit organization, said she doesn't see guarantees as a consumer benefit. "It wasn't a consumer problem," she said. "It fills a need for the merchants and could be a real cost for consumers."
"This is not for all restaurants," said Mr. Wirshba. "Some restaurants may only use the reservation on special holidays, and some might not like it at all, because it is too controversial."
Some car rental agencies, it appears, are also having second thoughts about reservations requiring the customer to cancel or pay. Though the agencies requested the card programs, not one is using them so far.
Visa expects some of the major companies, like Alamo Rent A Car, Avis, and National Car Rental, to sign up in the first half of this year. American Express is also waiting for the car companies to adopt its program.
Visa cardholders would be required to cancel their car rental reservation eight hours before the scheduled pickup or pay a fee. American Express' program calls for 48-hour notification.
In return, the car rental companies would promise to provide a car even when they overbook, and, among other benefits, cars would be held past the scheduled pickup time.
A spokesman for Visa said the association has no plans to develop a program for the restaurant industry because, there are no advantages to the cardholder.
MasterCard has neither a car rental nor a restaurant program, and according to Lawrence Biondi, MasterCard's vice president of travel and entertainment U.S. acceptance, the association is "taking a different approach" to the no-show problem.
The Purchase, N.Y.-based association is sponsoring a series of seminars at 160 hotels to help develop a standard for how reservation clerks communicate cancellation policies.
"There is a strong need for a consistent message to the consumer," said Mr. Biondi.
MasterCard may eventually develop restaurant and car rental guarantee programs, but for now the association is focusing exclusively on its consumer awareness campaign.
