Sharing a vacation home with friends can be stressful, especially when you’re the organizer putting the rental costs on your credit card. Will people pay you back? And if so, will they do it in a timely manner?
It can be awkward to ask friends for money, but a new Airbnb feature will make it so you won’t have to. Starting on Nov. 28, the home sharing platform will allow travelers to split the cost of a rental with other people in their group. Airbnb says that it’s the first accommodation platform to provide this service.
According to a recent study complied by DKC Analytics, 79% of American travelers have been on multiple group trips in the past five years. Of those who have traveled in a group, about 38% say that they weren’t paid back all of the money they were owed by people in their group. Even worse, 43% of that group say they’ve lost at least $1,000 from group trip repayments.
These statistics, and feedback from consumers, led Airbnb to introduce the ability to split payments. “We’ve tested this in recent months with more than 80,000 groups successfully using the feature from all over the world in nearly 175 countries, using over 44 different currencies,” Airbnb said in a statement.
So far, the top cities where Airbnb guests are splitting payments are Paris, New York, Amsterdam, Los Angeles and London.
How it works
Let’s say you’re the group organizer.
After you find your preferred booking, the total amount due is split evenly among the number of people in your group and your portion of the bill is charged to your credit card. This holds the reservation, which is then put in an “awaiting payment” state.
From there, the other people in your group have 72 hours to log-in to Airbnb and pay their portion of the bill. This means you’ll still have to track down your friends and pressure them to pay up, but it will happen before the trip and your money won’t be on the line.
If the rest of your crew fails to pay within the 72 hours, Airbnb will give the organizer another 24 hours to pay the remaining balance (or get the other group members to chip in) before the reservation is released. If this occurs, anyone who paid their portion will be refunded.
Airbnb’s study found that 29% of American travelers have fought with a friend over money that was owed for a trip. Thankfully, this feature, (and apps like Splitwise and Divvy) take the emotion out of splitting costs. Which leaves you time to worry about what really matters…like who gets the biggest room.
Brittany is a reporter at Yahoo Finance.