Why do I have to pay a deposit for a rental car?

Important facts described briefly below:

Car rental companies often require a security deposit for the car rental. Please note that a valid, embossed credit card issued to the main driver is mandatory for the deposit. Visa Electron, Maestro / EC, prepaid, or debit cards are not accepted on-site. Please refer to the voucher for more detailed information on the amount of the deposit or the accepted credit cards. 

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When you book and pick up a rental car, you usually have to pay a deposit. The deposit serves as financial security for the car rental company while you drive the vehicle. To pay the deposit, you usually need a credit card. There are, however, exceptions: sometimes, it is possible to book a rental car without a deposit or credit card. Below, we will explain what you should know about the car rental deposit.

Why do I have to pay a deposit for the rental car?

The car rental company protects its property by making you pay a deposit. The company protects itself against damage to the car during the rental period. Providers often do not have their fleet of vehicles. They mediate the rental cars of local car rental suppliers. Because of this, the suppliers often require a deposit to cover any damage.

How expensive is the car rental deposit?

The amount of the deposit depends on the car rental, country, and the category of the rental car. Many car rental companies take a deposit that is equal to the deductible so that in the case of damage, it is paid. The amount is often between 350 and 2,700 dollars. However, other amounts are also possible. Please note that many rental companies require an additional fuel deposit in addition to the security deposit for the vehicle.

Car rental with a refundable deductible: Do I still have to pay a deposit?

With many car rental companies, you have the choice of booking a rental car with or without a deductible. If you choose the option without a deductible (also called with a refundable deductible), you will usually still have to pay a rental car deposit. In the event of a damage claim, the car rental company will retain the deposit.

However, after returning the rental car, you can then file a complaint with HAPPYCAR. Often additional documents like a damage report, photos, or a police report have to be attached. The complaint is then checked and submitted to the provider/insurer for reimbursement. If it complies with your rental agreement, the terms and conditions, and any other written agreements, you will be refunded the amount of the deposit. However, the process may take a few weeks or months.

How do I pay my rental car deposit?

Many rental companies require that you pay the deposit with a credit card. The card must be issued in the name of the driver. The credit card of another person is usually not accepted. In this case, the car rental company may refuse to hand over the vehicle.

Furthermore, it must be a fully valid credit card. Prepaid credit cards or non-embossed debit cards such as Visa-Electron are not accepted. They are not suitable for a rental car deposit, as only money can be debited from these cards. For the deposit, it is usually necessary that an amount can only be blocked.

Tip: In case of doubt, you should ask your bank to make sure that your credit card is fully valid and has a monthly credit limit. Inform yourself in good time about the amount of the deposit and, if necessary, increase your credit card limit in advance.

What happens with the car rental deposit?

Most car rental companies block the deposit on the credit card but do not charge it directly. In rare cases, the amount is debited and refunded after the car is returned if there is no damage to the vehicle.

For some car rentals, it depends on how long you book the rental car. If the rental period is very long, the deposit will be deducted. If the rental period is short, it will only be blocked.

If there is damage to the car when you return it, the deposit for the rental car is often retained directly. If it turns out that the damage was not your fault, you will get your money back later.

How long is the rental car deposit withheld?

This varies depending on the car rental company and bank. If you return the rental car in a proper and undamaged condition, the blocked amount will be released. How long this takes depends on how long the car rental company blocks the amount due to security reasons. It also depends on how quickly your bank works and releases the amount. Usually, it happens very quickly. It can, however, also take a billing period. More detailed information can usually be found in your rental contract or the terms and conditions of the local car rental company.

Can I pay the car rental deposit in cash or with a debit card?

Since not everyone has a credit card, the question often arises whether it is possible to pay a deposit without one. Usually, a full credit card is required, but there are a few exceptions. With some offers, it is possible to pay the deposit in cash or with a debit card. Whether this option is allowed depends on the car rental company, the type of car, and the country you rent it in. Paying the rental car deposit in cash is allowed at some car rental companies in the following countries:

• Austria
• Spain
• Portugal
• Italy
• Greece
• Croatia
• South Africa
• Costa Rica
• New Zealand
• Australia
• USA

Are there rental cars available that don’t require a deposit?

Most car rentals require a rental car deposit. In some cases, it is possible to book a rental car without a deposit. This depends on the specific offer, the car rental company, and the country. The age of the driver may also play a role. For example, if you want to book a rental car from the age of 18, you often have to pay an additional fee.

Car rental deposit: Do I need additional insurance from the car rental company?

If the car rental deposit is paid at the local car rental company, the employees often try to sell customers additional insurance. In another country, there are sometimes communication difficulties due to the foreign language. Therefore, always be attentive to whether you really need the additional insurance offered there. Before purchasing, check what you are already insured against. Usually, the conventional rental car insurances, like liability insurance, or comprehensive insurance, already cover many risks.

An example: Additional insurance against ashes and sand you usually do not need in Ohio. On an island of volcanic origin, however, this can be useful. Therefore, you should always decide on a case-by-case basis, depending on where you are traveling to, which insurance you would like to have.

Tip: Even if you have fully comprehensive insurance with a refundable deductible, you often have to pay for the damage yourself in the case of gross negligence. This includes, for example, driving under the influence of alcohol or drugs and losing the car keys. Therefore, please note which exclusions of liability exist with your insurance company.