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Using a Debit Card to Rent a Car

Updated on May 20, 2012

Can you . . . Should you Rent a Car with a Debit Card?

In 2012, the issue of using a debit card to rent a vehicle is becoming ever more present as renters are wanting to keep those high interest credit cards in their wallets. Renting a car without a credit card can be problematic for both renters and car rental agencies. Compared to a credit card, a debit card provides a significantly higher level of risk for the car rental company and while many USA car hire companies are opening their policies to the use of debit cards, there are some pit falls renters need to consider before they plan to hand over their debit card for a car rental. The good news is that it can usually be done.

For some other great tips on finding car rental coupons and getting great car rental discounts, see also Car Rental Coupons and Ten Ways to Save on Car Rental.

Photo Used under Creative Commons from MoneyBlogNewz

Quick Polls: Who's Viewing This Page?

Before we get into the subject matter, here are a few poll questions regarding your opinions on this issue. Take a couple of moments to answer these questions (remember Squidoo members get points for it).

Have you ever rented a vehicle in the past?

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With A Debit Card?

Have you Ever Rented a Vehicle using a Debit Card?

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Credit vs. Debit?

Do you think it is better to use a Debit Card or a Credit Card to Rent A Vehicle?

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When Are You Renting?

When are you planning to rent a vehicle?

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A Debit or Check Card is Not a Credit Card

Many debit and check cards can be used to run a credit transaction. This does not make a debit card a credit card and the car rental company will not (or at least they shouldn't) accept a debit card as a credit card. Accepting a Debit Card as Credit Card for a rental transaction can cause problems for the renter as well as the Car Hire company (we'll take a closer look at this later in "Additional Deposits May be Required"). All cards have a Bank Identification Number (BIN) attached to them. When the card is run at the open of the transaction, the car rental company will likely check the BIN to determine if the card is a credit card, debit card, or pre-paid card. If the BIN returns information that the card is something other than a Credit Card, the policies regarding the type of card will apply. This also means that if the company does not accept debit or pre-paid cards, the rental of the vehicle will be denied to you.

If you are not sure what kind of card you have, you should call your card issuer using the phone number found of the back of the card for more information.

Not Everyone Can Use a Debit Card to Rent a Vehicle

Companies will have differing policies for when a debit card will and will not be accepted for a rental. You will need to read the company policies completely, contact the company's customer service department, and/or call ahead to the rental location directly before arriving to rent a vehicle if you are planning to rent a vehicle using a debit card. In many instances, a debit card will only be accepted for qualified customers who can provide a round trip airline itinerary that matches the dates of travel for which the rental of the vehicle will be done. I have also come across companies which impose additional restrictions based on age and proof of insurance.

Additional Deposits May be Required

An additional deposit over the opening estimated total of the rental may be required when you open the rental transaction using a debit card. This deposit is required for your protection as well as the company's. Please bear with me as this is a rather complex issue which needs a relatively lengthy explanation.

Before we get started, let's quickly go over authorizations and payments. An authorization or hold is a temporary transaction used to reserve a specified amount from the available balance of the card. The authorization will usually show as a "Pending Transaction" or similar on the transactions for the card. A charge or payment is a permanent transaction which is debited from the available balance of the card. Charges will usually appear as "Posted Transactions" or similar on the transactions for the card. When an authorization is obtained and a charge is subsequently taken from that authorization, it usually takes 2-7 days for the transaction to move from pending status to posted status. However, please note that this is not the case when a PIN is used to complete a debit transaction. Most PIN transactions will automatically appear as posted transaction.

When using a credit card, an authorization is taken at the open of the rental agreement. The amount of the authorization that the company will require tends to vary, but it is usually in the amount of the estimated total of the rental or a set percentage / dollar amount over the estimated total. Note: Car rentals are shown as an Estimated Total at the open of the agreement because the cost of the rental may change for many reasons such as the vehicle could be returned late / early costing your more / less than estimated at the open of the rental or charges could be added for fuel, etc. Authorizations on credit cards will usually last between 10-20 days or for as many days as the rental of the vehicle is scheduled. When the vehicle is returned, the charges are finalized and the actual total of the rental is charged to the card using the original authorization (provided you do not change the payment method on return).

An authorization will only last for 3 to 5 days with many debit and check cards. If the authorization is not confirmed within the required time frame, the authorization will expire and be released back to the available balance of the card. There are many potential problems for you and the rental company when only an authorization is obtained at the opening of the rental, because most car rentals last more than 3 days. If the authorization is released, the money which was to be reserved for the cost of the rental could be spent by the renter on other things before the rental is completed and the car rental bill is paid. The bank / card issuer may or may not accept a charge to the original authorization even if it has been released. This means that your account could be overdrawn if the necessary funds are not available when the finalized charge posts to the account or the transaction could be rejected by the bank / card issuer. Either way, this would present a major problem for you and/or the car hire company.

Some car rental companies have adopted deposit policies to prevent many of the potential problems caused by the authorization / payment process of a debit card. As opposed to simply obtaining an authorization, the company will charge the debit card for the estimated total of the rental plus a deposit. The amount of the deposit can be as much as $500.00 more than the rental. When the vehicle is returned, the deposit is usually refunded, but it may take several days for the refunded amount to show up in your available balance. Refunds will usually take as long to return to the account as it takes for a payment to move from pending to posted transactions. Note however that unlike a payment, an authorization is not required to issue a refund and you will likely not see a pending transaction showing that a refund is in route.

NSF, Overdraft, or Similar Fees

All car rental companies will have terms built into their rental agreements which state that they are not responsible for any fees which are imposed by your bank / card issuer which may be caused by any of the authorizations or charges from the car rental. These terms are set up as a result of the complex nature of the debit card car rental process. Before you use your debit card for a car rental transaction, you should be sure to have more than ample available funds to pay for the rental.

Pre-Paid Cards

Pre-Paid Cards are uniquely different from standard credit cards and bank issued debit cards. Some common examples are the Emerald Card issued by H&R Block and the Account Now Pre-Paid Visa and Master Cards. Many car rental companies will simply not accept these cards. However, if you are permitted to use these cards for a car rental, be aware that these cards pose several more complicated issues than bank issued credit cards. Many of these cards have specific warnings regarding their use for a car rental transaction. You should read all of the terms and conditions of the card before you consider using them for a car rental.

Amscot Pre-Paid Master Card

The Amscot Pre-Paid Mastercard is not a debit card. The Amscot FAQ's indicate that purchases may be denied at car rental agencies because of insufficient funds. Be aware that not all car rental agencies will accept the Amscot card, and you should call the car rental location directly for additional information about wanting to use this type of card.

Read from the FAQ's from Amscot

Thanks for Stopping By!!! - Let us know what you think!

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    • EzLoanLookUp LM profile image

      EzLoanLookUp LM 4 years ago

      Great information thank you

    • DrLibby profile image

      DrLibby 4 years ago

      I've been avoiding renting a car for this very reason. we only have debit cards. great post that answers lots of questions. thanks

    • filcaske1 lm profile image

      filcaske1 lm 4 years ago

      @anonymous: I know exactly how you feel. I don't have a credit card either, and even though I work for a rental company, I can't even rent from them, my own place of work with my debit card, UNLESS I have return flight confirmation, but I won't be flying anywhere! My only idea is just get a credit card just for trips, pay it off before the end of the month, and you won't have any finance charges :)

    • filcaske1 lm profile image

      filcaske1 lm 4 years ago

      @anonymous: I work for National/Alamo rental car. Sorry it took so long to get back to you, anyway the other reason debit cards are so risky for renting a car is because the hold usually will fall off before you return the car. We don't hold any additional amount at our location, only the exact amount owed, however on a debit card, lets say your total is $150.00, that amount will authorize on your card when you pick it up, however usually within 24-48 hours that hold falls off the debit card. Leaving the rental company at risk of the renter returning and not having the funds available to charge for the rental. However, with a credit card, that hold stays on the card, and even if it falls off, as I said before we can do a force charge. Hope that's a little bit better explanation, kinda complicated even for me! I still work there and love it! I am getting ready to do a lens about the upsell, insurance and fuel options and the renting process in the next couple days!

    • profile image

      anonymous 4 years ago

      i refuse to have a credit card. so was lucky to come across www.indigocarhire.com.au who got me in touch with a supplier that would accept my westpac debit card and they only too a deposit for the tank of fuel.

    • profile image

      anonymous 4 years ago

      NONE

    • profile image

      anonymous 5 years ago

      I think it's absolutely disgusting that in this day and age people want us to all to borrow money that isn't ours in order to function! What happened to using actual real money that you've worked hard for? I am only 24 and am about to go on holiday to Barbados and the amount of hassle I have had over trying to rent a car with no credit card is unbelievable!! Our world is falling apart and the economy has sunk and they don't want people to be in debt but the only way you can "hire a car" or pay for a hotel in some places etc is by borrowing money that isn't yours (ie. CREDIT CARD!!!) I choose not to have one, not because my credit is poor but because I was brought up to earn your money not borrow it. How many more people do we need in debt??? Sorry but had to rant as getting so annoyed with people expecting I own a credit card :(

    • OrlandoTipster profile image

      OrlandoTipster 5 years ago

      I do know in Florida that Dollar & Thrifty car rental companies run a credit check if booking with a credit card.

      They'll levy a deposit depending on credit score.

    • profile image

      DMVAgent 5 years ago

      If you don't mind I would like to suggest a new topic: Reviews on Car Insurance Companies. Thanks! Great info! :)

    • galant profile image
      Author

      galant 5 years ago

      @Alethia LM: Yes, for most people it will not be that much of an issue. I think what causes the most problems is that people don't understand and/or weren't informed of the potential issues with renting a vehicle using a debit card. As a result, they don't budget appropriately, etc. which can cause a myriad of issues with transactions that occur after the rental transaction, among other things.

    • Alethia LM profile image

      Alethia LM 5 years ago

      Very interesting. I saw a friend of mine rent a car using a debit and it turned out a be not that much of a hassle except for some sort of security deposit. Thank you very much for this information.

    • galant profile image
      Author

      galant 5 years ago

      @ellagis: Yes, it absolutely becomes more problematic to resolve any issue after the transaction has been settled and travelers have returned home. Many renters think that they can simply drop their vehicle off and walk away. I recommend getting a final receipt and settling the bill completely before leaving. That way all charges for fuel, etc. are made known. By paying cash when you return the vehicle, you do that. However, it is worth noting that some credit cards carry a Collision Damage Waiver for car rentals which is only effective if the transaction is opened with and paid for finally with the credit card.

    • galant profile image
      Author

      galant 5 years ago

      @anonymous: Picking a car rental company is often times different at each airport (I am assuming you are flying to a destination and need to rent car), and I always try to pick a company which has on-airport/in-terminal service which does not require a shuttle to an off-site location to pick up a vehicle. This is very helpful when returning a car and trying to catch a flight. If Thrifty is on airport, I try to go with them. I tend to travel light and I find that their "Wild Car" deal is pretty cool. Remember each location (even within the same brand/company) may have different policies regarding debit cards. Be sure to check the policies/terms of the rental location and/or call them to make sure you can use a debit card.

    • profile image

      anonymous 5 years ago

      @filcaske1 lm: Which company do you suggest?

    • filcaske1 lm profile image

      filcaske1 lm 5 years ago

      I work for a car rental company. We do accept debit cards, with round trip confirmation number ONLY! It does pose a higher risk to the renter and to us, because a debit card we can't force charge if they show up late or show don't show up at all! A credit card we are able to force charge them if need be over the credit limit!

    • ellagis profile image

      ellagis 6 years ago

      Very interesting lens! I didn´t know that much about debit cards. I rent a car twice or three times per year, more or less, and I always prefer to give my credit card as guarantee... and finally paying cash. I think it helps avoiding any kind of bad surprise, after! When you rent a car you´re usually far away from home, so after you´ve taken your flight back home every discussion becomes more problematic, don´t you think?

    • profile image

      anonymous 6 years ago

      Very interesting lens. I just came back from vacation. I was in Spain and found this company Sixt rent a car that provided me with a great service...They did not accept accept any prepaid cards or debit cards but I think that the most important thing about this debate is not the question of whether or not using a debit or a credit card when renting a car but finding a reliable company that can take care of your needs and make the approval and paper process easier and faster .

    • profile image

      chrisyaldous 6 years ago

      A nice lens. I had trouble renting a car in Cambodia even with a Credit Card. It took ages to get acceptance.

    • Deano1979 profile image

      Deano1979 6 years ago

      Great lens and very useful when coming to rent a car

      Regards

      Car Body Repair

    • najem lm profile image

      najem lm 6 years ago

      Nice lens! Hope you like also my lens about rent a car in Slovenia: Rent a car Slovenia

    • charle lm profile image

      charle lm 6 years ago

      Nice lens , it will help more people , I also wrote a lens about prepaid credit cards and would like you to read it , thanks

    • SafeCard LM profile image

      SafeCard LM 7 years ago

      It could really be convenient for regular travelers to have this kind of service.

      Sometimes lack of knowledge of the staff can be the cause of disservice or problem,nice lens!

    • galant profile image
      Author

      galant 7 years ago

      @anonymous: Yes, it can be frustrating. Policies can vary from location to location even within the same company. To ensure that we don't get blindsided by an unexpected inconvenience, I would suggest that a renter calls the location from which they intend to rent the vehicle and ask all relevant questions to them directly.

    • profile image

      anonymous 7 years ago

      ah the amount of times i've been accepted with a debit credit card for a car rental, only to be refused the next time. i think staff just don't have the education on them or what they are... still i hope they don't learn cos a debit card is all i have...

      My site: Credit Card Comparison