Is the 'Authorization Fee' charged by Crowne Plaza dependent on whether the transaction is approved?

According to Crowne Plaza's 2025 Franchise Disclosure Document, the Authorization Fee is charged for each transaction submitted for authorization, regardless of whether the transaction is ultimately authorized or approved. This means that a Crowne Plaza franchisee will incur this fee for every attempt to validate a credit or debit card transaction, irrespective of the outcome.

This policy has significant implications for franchisees. It means that even if a card is declined or the transaction fails for any reason, the franchisee will still be charged the Authorization Fee. Franchisees need to be aware of this cost, as it can add up, especially if there are a high number of declined transactions. This fee is separate from other fees, such as the Transaction Fee, which may also apply.

Franchisees should consider implementing measures to minimize declined transactions, such as verifying card information and using fraud prevention tools. Additionally, the FDD mentions that this Authorization Fee may be reduced to $0.01 based upon terms in the IHG Agreement. Franchisees should review their IHG Agreement to determine if they qualify for this reduced fee. Understanding the conditions under which this fee is applied is crucial for managing transaction costs effectively.