Payments are increasingly perceived as a key component of the strategy of travel-related actors, including both travel providers such as airlines and hotels, and travel agents such as Online Travel Agencies (OTAs) and Travel Management Companies (TMCs).
As the travel sector is transitioning out of the pandemic, payment is perceived as a key component to support the rebound in a post-Covid-19 world. Travel-related actors discussed during the event key trends such as payment orchestration, Buy Now Pay Later (BNPL), payment optimisation, B2B travel and virtual cards and crypto-currencies.
- Payment orchestration was often mentioned in EDC’s discussions with airlines and travel agents. Travel providers and travel agents increasingly require flexibility regarding payments for specific sales channels, markets or use cases and payment orchestration is a key enabler to facilitate this flexibility and deliver significant benefits such as better conversion and optimised costs.
- Panel discussions have highlighted the increased interest and usage of BNPL in the travel industry. BNPL meets travellers’ requirements to pay for airline tickets as instalments allow consumers to play the role of short-term credit. Travel providers also indicated that BNPL contributes to the recovery of the travel industry in the post-Covid era.
- In a panel discussion on B2B travel, it was acknowledged that there is a need for a better-balanced value proposition between travel providers and travel agents. On one hand, travel providers such as airlines must gain a better understanding of the whole value proposition of B2B travel payment products such as virtual cards, including costs, drawbacks and benefits. On the other hand, travel providers need to be aligned internally – for instance, the payments, distribution and revenue accounting teams at airlines need to engage and define cross-department perspectives to make informed decisions when selecting the most relevant payment methods for B2B travel
- Crypto-currencies were also highlighted as a key trend to watch. There are increased investments related to cryptocurrencies from the payment industry and an increasing number of travel providers – both airlines and hotels – are considering/implementing the acceptance of cryptocurrencies. Spanish low-cost airline Vueling shared interesting perspectives on cryptocurrencies with the objective to accept cryptocurrencies before the end of 2022
There are many changes in the distribution and payments landscape, and it is important for travel-related actors to gain a good understanding of these changes to make informed decisions that support their future growth.
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