Future-proofing payments

The travel sector is on the brink of a monumental shift. As consumer behaviours evolve, the pressure is on airlines to update their payment systems to meet digital age demands.

The era of card payments is diminishing, with forecasts suggesting only a 4% annual growth until 2030. This signals a critical need for a more diversified payment portfolio.

In the wake of recent global upheavals, offering flexible and customer-centric payment options is now essential for airlines to stay competitive and profitable.

This shift is not just about keeping up but anticipating future trends to stay ahead in the industry. Airlines ignoring the need for modern payment solutions risk losing sales, customer loyalty, and ­market share. In the spotlight of digital transformation, adopting a variety of innovative payment solutions is a strategic necessity for any airline aspiring to succeed in the post-digital era.

In this e-book, we’ll explore the future of the payments industry and analyse the disruptive influence of emerging payment trends and the rising demand for Payment Orchestration, which helps ­businesses ­navigate the complexities of modern payments and meet the ­ever-changing needs and preferences of their customers.

Evolution of consumer payment preference

Payment preferences are changing rapidly. The emergence of mobile payment platforms and digital wallets marks a new era where convenience is paramount.

With Apple Pay users anticipated to exceed 507 million by 2025, the popularity of mobile payments is undeniable. Similarly, the Buy Now, Pay Later (BNPL) model has transformed consumer credit, ­appealing especially to younger consumers wary of traditional credit card debt.

These payment methods not only offer convenience but also cater to the financial habits of a vast segment of the airline customer base.

Embracing a variety of payment methods and systems is crucial for understanding and meeting the financial needs of today’s consumers, thereby enhancing customer experience and loyalty.

The role of Payment Orchestration in future payments

Payment Orchestration is key to ­future-­proofing payment processes, offering a ­streamlined ­solution over traditional, restrictive payment ­systems.

It enables seamless integration with a multitude of payment service providers (PSPs), accommodating a growing array of payment methods including digital wallets, bank transfers, and BNPL services.

As the global payment gateway market is expected to reach $64.5 billion by 2027, the importance of a scalable and efficient payment ­infrastructure is evident.

Payment Orchestration Platforms offer a robust framework to handle transaction volumes while ensuring a seamless and secure customer experience.

Challenges with traditional bundled payment solutions

The traditional payment systems in the airline industry, once adequate, now face significant challenges in meeting modern e-commerce expectations.

The limitations include cumbersome reconciliation processes, rigid infrastructures, and a lack of customisation, all of which hamper the ability to provide frictionless payment experiences. Specific challenges ­include:

1. The burden of data reconciliation

Traditional bundled payment solutions often require manual efforts to reconcile transactions, match payment data, and ensure accuracy.

This time-consuming and error-prone process can lead to inefficiencies and increased operational costs for airlines.

The lack of automated reconciliation capabilities increases the risk of human error, potentially resulting in discrepancies in financial records and difficulties in tracking and resolving payment-related issues.

2. Management of technical connections

Bundled payment solutions typically have a fixed set of technical ­integrations with payment service providers (PSPs), limiting the ­flexibility for airlines to adapt to new payment methods or onboard ­additional PSPs.

As new payment options emerge, airlines may face difficulties in ­integrating them into their existing bundled solution, resulting in missed business ­opportunities and/or the inability to cater to evolving customer preferences.

This rigid infrastructure can hinder the airlines ability to embrace emerging technologies and keep pace with the rapidly changing ­payment landscape.

3. Lack of componentisation

These solutions also lack the componentisation necessary for ­future scalability and customisability. Airlines may find it challenging to ­integrate individual payment functionalities or services according to their specific needs.

This inflexibility restricts their ability to tailor payment experiences and limits innovation in payment offerings.

As customer expectations evolve, airlines need the freedom to choose and combine various payment components, such as fraud ­detection systems, subscription management, or loyalty program ­integrations, to create a unique and personalised payment ecosystem.

4. Inadequate support for global expansion

As airlines expand their business globally, they encounter diverse ­regional payment preferences and regulatory requirements.

However, traditional bundled payment solutions may lack the ­necessary support for international payment methods, local currencies, or compliance with specific regional regulations.

This limitation restricts the airlines ability to provide a seamless payment experience to customers worldwide and may result in lost sales opportunities in ­different markets.

5. Security and compliance challenges

Traditional bundled payment solutions may not always offer the level of security and compliance required in the modern payment landscape.

With increasing instances of data breaches and evolving regulatory standards, airlines need robust security measures and compliance functionalities to protect sensitive customer information and adhere to industry regulations.

Without these capabilities, airlines may face reputational damage, financial losses, or legal repercussions.

Advantages of Payment Orchestration for future-proofing

Payment Orchestration is a game-changer in future-proofing payment processes for airlines, offering a range of advantages that optimise payments and prepare businesses for the evolving landscape.

1. Time and cost savings

By consolidating multiple payment service providers (PSPs) into a single interface, Payment Orchestration Platforms streamline payment ­management – eliminating the need for airlines to individually manage and integrate each PSP.

This automation not only reduces manual effort but also minimises the potential for errors, saving valuable time and resources for airlines.

With Payment Orchestration, airlines can optimise their ­payment processes, reduce operational costs, and focus on their core business tasks.

2. Flexibility and adaptability

Embracing Payment Orchestration allows airlines to easily adapt to new payment methods; such as mobile wallets or alternative payment options.

The flexible integration capabilities of orchestration platforms enable airlines to stay ahead of consumer preferences and cater to a wider customer base.

By embracing diverse payment options, airlines can enhance the shopping experience and improve customer satisfaction.

3. Scalability

As businesses expand, Payment Orchestration Platforms offer them the scalability needed to handle increasing transaction volumes, ­without sacrificing performance or stability.

Whether processing a few transactions or millions, Payment ­Orchestration Platforms can efficiently handle the load, ensuring a seamless payment experience for customers.

This scalability empowers airlines to grow their businesses, enter new markets, and handle higher transaction volumes with ease.

4. Insights and analytics

Payment Orchestration Platforms provide airlines with valuable insights and analytics. These platforms offer detailed transaction data, including payment success rates, customer behaviour, and revenue trends.

By leveraging this information, airlines can make data-driven decisions, optimise their payment strategies, and identify growth opportunities.

The actionable insights gained from Payment Orchestration ­enable airlines to enhance customer experiences, drive ­revenue growth, and stay competitive in the market.

Future-proof your payments with CellPoint Digital

Choosing the right Payment Orchestration provider is crucial for airlines aiming to stay ahead. CellPoint Digital stands out with its sophisticated solutions tailored for the airline industry, ensuring flexibility to adapt to emerging payment innovations.

Our platform not only enables airlines to manage global payments and navigate regulatory landscapes efficiently but also fosters a culture of innovation. With CellPoint Digital, airlines unlock the full potential of Payment Orchestration, maximising efficiency, minimising risk, and enhancing customer trust and satisfaction.

To future-proof your payment processes and unlock the benefits of Payment Orchestration, partner with CellPoint Digital. Contact us today to learn more about our solutions and how we can help your business thrive in the rapidly evolving Paytech landscape.

With our expertise and cutting-edge technology, you can stay ahead of the competition, deliver exceptional payment experiences to your customers, and drive business growth.