Eli5 why do shops, hotels and so on reserve a larger amount than needed on credit cards.

Question

For example, I’m staying in a hotel, I pay for my room with MasterCard. The total comes to 250 dollar. I check my credit card statement 2 days later and there is 250 dollar off the account and an other 250 reserved.

In: 2

Answer 1

Let’s say it costs $200 to spend a night in a room with a $500 TV set. They stand to lose much more than the $200 you might not pay, if you decide to be unreasonable.