Airbnb announced Tuesday that it is launching its “Reserve Now, Pay Later” feature globally. The new feature allows users to confirm a reservation immediately without paying a fee and allows them to cancel a reservation without losing money in advance if their plans change.
The company launched the feature last year for domestic travel in the United States. Airbnb said that listings with “flexible” or “moderate” cancellation policies are eligible for this option. In this case, the user is charged closer to the check-in date rather than at the time of booking.
The model is similar to the “buy now, pay later” mechanism popular in e-commerce and makes expensive travel expenses more affordable. According to the company, 70% of eligible reservations have taken advantage of this option since the feature was launched.
Airbnb said in its fourth-quarter 2025 financial report that the new feature contributed to an increase in the number of nights booked during that period. The company’s CFO Ellie Mertz noted that this feature has particularly increased interest in large homes with four or more bedrooms and has contributed to an increase in average daily rates.
At the same time, the overall cancellation rate increased from 16% to 17% in the fourth quarter. This increase was mainly higher among users who booked in advance and chose the option to pay later. However, the company does not consider this a significant increase compared to overall cancellations on the platform.
Airbnb, in collaboration with London-based company Focaldata, conducted a survey of U.S. travelers last year. 60% of respondents said that the ability to pay later at the time of booking was important, and 55% said that they would use such an option.
Airbnb has been testing pay later models for several years. In 2018, the company introduced a product that allowed people to pay 20% or 50% of the amount at the time of booking and pay the rest later. In 2023, Airbnb partnered with fintech company Klarna to allow users to split their payments into four installments over six weeks.
