There has been an Airbnb practice that seems to never be discussed and, while it has always bothered me a little, I never really felt it was worth making much of a fuss over because it wasn't really directly impacting my experience or success as a host. But then I read a thread tonight about another host's realization that by Airbnb taking money from the host in the event of a natural disaster, or a guest's health emergency, etc. to refund the guest, Airbnb has effectively made it's hosts the travel insurance for their guests (instead of requiring that guests rely on privately purchased travel insurance like hotels and airlines do). Now, I am not a heartless monster and I definitely think that guests who have to cancel due to health emergencies, natural disasters, or the like should be granted a refund. But that refund should come from Airbnb (if the guest did not purchase travel insurance), not the host. And the reason why is because of the Airbnb practice that seems to never be discussed.
The practice is Airbnb debiting the guest's bank at the time of booking but not crediting the host until the day after the guest has arrived. Airbnb is making an INCREDIBLE amount of money off of all of this money that is held in transit from guest to host, yet the website only mentions the service fees as the place where Airbnb makes their money. Not only are they making money on just the interest alone (think of the billions of dollars sitting in their bank as it waits to be paid out to the host!), but it would stand to reason that they are also investing most of that money. Why else would they employ this practice of withholding the money from the host until after the guest checks in? And why isn't this talked about more? Does no one else question why they withold the guests money from the host?
Honestly, I wouldn't have an issue with them witholding my money so they can earn that interest and invest it for awhile. But they shouldn't then ALSO take my money when a guest cancels. And I definitely have an issue with the fact that they only mention the service fees as their means of income. I am no accountant or ecomomist, but it seems like the interest and investments would make Airbnb WAY more money than the service fees. Shouldn't they be honest and upfront about that? And shouldn't they grant hosts the courtesy of paying back the guests who cancel with extenuating circumstances from the billions upon billions that we allow them to make with our money rather than forcing us to pay the refund?
I needed to finally bring this up because, 1) I am baffled as to why no one ever discusses why Aibnb holds the money nor the implications of this practice and I am dying to get others' take on it. And 2) Whenever I read horror stories of terrible guests it makes me upset for that host but I also feel like it helps prepare me for when I get that inevitable terrible guest so I can either ensure that I get compensated or I can learn to let it go and chalk it up to the realities of the sharing economy. But this is a whole different beast because there is nothing a host can do to prevent money being taken from them when a guest cancels with extenuating circumstances. This didn't initially bother me, just like the money being held didn't initially bother me, until I realized it meant we were the guest's travel insurance. And this becomes an even bigger offence when combined with the fact that if Airbnb really wanted to provide travel insurance to guests then they could use the billions they're making off interest and investments to pay it or just require the guest to get their own travel insurance.
At the end of all of this I will say, though, that if anyone knows for sure that Airbnb does NOT invest our money nor make money off the interest while withholding our money after the guest has paid, then I would honestly love to hear it because this has made me so upset and I really don't want to be because I do love hosting and still intend to do it for as long as I can. So please, if you know for sure that I am wrong or have misunderstood something then please (kindly) clarify things for me. I want to keep loving and supporting Airbnb!
