Airbnb Introduces Split Payment Option

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Airbnb has introduced the ability to split your payments for a stay. The new system, called “Pay Less Upfront”, came into effect as of January 15, 2018. According to the Airbnb press release, the functionality comes in response to the fact that 40% of its customers opted to use this option in testing. Most of those who opted for a split payment also opted to take up higher priced bookings when making a split payment.


Pay Less Upfront Key Features

  • Pay Less Upfront is only available for bookings of more than $250
  • Pay Less Upfront is only available on bookings made at least 14 days in advance
  • In most cases, the initial payment is a 50% deposit
  • The balance will be charged just prior to the stay
  • Airbnb will notify you 3 days prior to the balance of payment being charged

Our Take

At first glance we love this, especially given how many friends and groups we know that use Airbnb when traveling. However, keep in mind that Airbnb has self-admitted that allowing split payment has increased potential revenue with many people opting for a more expensive rental.

That isn't a bad thing, but just remember that this isn't 100% altruistic — it is a smart business decision. Remember, odd pricing came into effect when stores realized that one of the aspects of human psychology was that charging an odd price ($9.95 or $9.99 instead of $10.00) led to people buying more of the product. So, while you will benefit from convenience thanks to this new payment method, Airbnb wins as well.

Source: Live from A Lounge

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