Published: 11 May 2015
Q: I own a bar and restaurant and run a tab service. A ‘no charge’ swipe of a customer’s card is taken for the details and they are presented with a tab card with a unique number. If they decide to dine in our restaurant then they are expected, and also told, to hand over the tab card to a member of the restaurant staff so that the tab can be transferred. We find that occasionally the card is not returned by the customer and a drinks bill is left outstanding. The tab card states clearly that ‘all outstanding tabs will be finalized at the end of the day’. Am I within my rights to take a payment for unpaid goods with the card details taken from the original swipe without the card holder present?
A: You would be within your rights to take payment in these circumstances, as the transaction has been ‘pre-authorised’. The customer has given their card for the specific reason to order the drinks and he has been made aware that the tab will be finalised at the end of the day. It is worth noting that if that same customer came in again and ordered drinks on another day- the details from the previous swipe could not be used to settle payment for the drinks ordered on this day, as it has not been pre- authorised. The customer would have to authorise the transaction once again.
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