When a Direct booking is cancelled or a refund is needed, the process depends on the type of refund, your Direct plan (Premium or Basic), and when the refund is issued relative to payout. This article explains how refunds work end-to-end — for both hosts and guests.
Refund Processing Times
Once a refund is issued, the time it takes for the funds to reach the guest depends on the original payment method.
Payment method | Estimated processing time |
Credit card | 5–10 business days |
Debit card | 5–10 business days |
Bank transfer | 5–10 business days |
If a booking is declined or expires before payment is captured, any authorization hold on the guest's card is typically released within 3–5 business days.
A screenshot showing a refund confirmation message in the Hospitable inbox for a Direct booking.
Types of Refunds
Full Refunds
A full refund is issued when:
The host cancels the reservation (a full refund is always issued, regardless of cancellation policy)
The guest cancels and the cancellation policy allows a full refund
A full refund includes the exact amount the guest paid, including the guest service fee.
On Direct Basic, the host is still responsible for Stripe processing fees, even on a full refund. These fees are not returned by Stripe.
Partial Refunds
A partial refund is issued when a guest cancels and the cancellation policy allows only a partial refund. The refundable amount is calculated based on:
The cancellation policy applied to the reservation
The accommodation cost for the refundable portion of the stay
Fees and taxes on top of the accommodation are refunded proportionally based on the policy
Service fee behavior on partial refunds:
Direct Premium: The service fee is collected (not refunded) on partial refunds
Direct Basic: The service fee is collected from the host on partial refunds
On full refunds, service fees collected by Hospitable are refunded on both plans.
Ad Hoc Refunds (Send or Request Money)
Hosts can issue refunds outside of the cancellation flow using the "Send or request money" feature in the inbox. This is useful for:
Issuing a goodwill refund after a guest complaint
Refunding for a service issue (e.g., broken amenity, early checkout)
Any situation where a partial refund is warranted outside of cancellation
Key rules for ad hoc refunds:
Available for up to 14 days after the reservation ends
The maximum refundable amount is the lower of: the amount the guest originally paid, or the current balance of the payout method
Hosts choose the amount to refund
A screenshot of the Hospitable inbox showing the "Send or request money" option on a Direct reservation conversation
What Happens to Host Payouts When a Refund Is Issued
The impact on your payout depends on when the refund is issued and your Direct plan.
Refund Before Payout
If the refund is processed before the payout has been sent to you, the refund amount is simply deducted from the pending payout. No further action is needed.
Refund After Payout
Direct Premium:
The refund is drawn from your payout method
If your payout method doesn't have enough balance, a deficit is created and deducted from your future payouts until the balance is recovered
Direct Basic:
The refund is processed through Stripe
If your Stripe balance is insufficient, the refund may fail or create a negative balance
On Direct Premium, ad hoc refunds automatically create a negative adjustment on your next payout to recover the refunded amount. You don't need to take any manual action — it's handled automatically.
Guest Perspective: Where to See Refund Status
Guests who booked directly can view their refund amount through the Guest Portal.
Once a refund is initiated, the guest will receive an email containing:
Confirmation that a refund has been issued
The refund amount
An estimated timeline for the funds to appear
If a guest asks about their refund status, you can let them know that refunds typically take 5–10 business days to process after being issued.
FAQ
Why is the refund taking so long?
Why is the refund taking so long?
Refunds typically take 5–10 business days to process once issued. The exact timeline depends on the bank or card issuer. If it has been longer than 10 business days, the guest should contact their bank or card provider for more information.
Can I issue a refund as a credit instead?
Can I issue a refund as a credit instead?
Currently, Hospitable does not support issuing refunds as account credits for Direct bookings. Refunds are returned to the guest's original payment method. Hosts may always cancel without refund and book as Manual bookings using the previous payment but they will no longer have the protections (Chargeback and Damage) that Direct Premium booking has.
What if the guest only used part of their stay?
What if the guest only used part of their stay?
If the guest need to leave early or only used part of their stay, whether they receive a refund depends on the cancellation policy. You can always use the Send or Request Money feature to send out partial refund out of policy.
Can hosts issue partial refunds directly?
Can hosts issue partial refunds directly?
Yes. Hosts can issue partial (or full) refunds using the "Send or request money" button in the Hospitable inbox. This is available for up to 14 days after the reservation end date.