Harness The Power of Payments: Freedom and flexibility

The payments ecosystem is a complex, multi-layered pathway of players that interact with each other during the payment transaction process.

Airlines navigate some of the most complex payment ecosystems of all merchants, with issuers, acquirers, credit card networks, payment processors, payment gateways, independent sales organisations and payment facilitators all relying on each other to fulfil their role successfully and securely. In addition, integration with ticketing systems, passenger service systems, alternative payment methods (APMs) and cross-border payments add complexity.

As technology has transformed payments there’s never been more choice of user-friendly payment methods that combine speed and security – or more consumer demand for frictionless payments in the language and in the payment type of their choice. Now’s the time for airlines to benefit from this with a Payment Orchestration Platform that gives you full control of your payment ecosystem and can allow dramatic step change improvements in legacy tech platforms.

Here are four ways Payment Orchestration can help airlines take payments, and their performance, to new heights.

1. Take the most intelligent route

Intelligent routing is a powerful tool to manage international and local payment methods as part of a multi-acquirer strategy. Based on rules of your choice, intelligent routing optimises each payment at the time of transaction by automatically routing to the most appropriate provider based on a variety of factors, including rate, payment method, risk and load balancing.

It also provides a fail-over strategy that routes to the next best payment provider in the event of a transaction decline or provider outage. If a transaction fails with one acquirer, you can set routing rules to automatically retry with a second-choice acquirer, then a third and so on, to ensure acceptance. This happens within fractions of a second, so it is transparent to your customers.

With CellPoint Digital’s Intelligent Payment Routing, both airlines and passengers get the best payment route that increases acceptance rates, lowers payment fees and always determines the best way to handle a transaction based on your unique business needs.

2. Remove turbulence from cross-border transactions

A Payment Orchestration Platform like CellPoint Digital’s Velocity platform gives airlines the edge when negotiating and managing cross-border payments and international acquiring rates. It provides you with the flexibility to work with and integrate multiple payment providers, allowing you to take advantage of the best rates across providers.

For your customers, Velocity enables you to streamline and standardise payment options and present only the right options to each consumer in each market.

3. Create resilience across fraud, refunds and disputes

Following the flood of refund requests during the pandemic and the fluctuations in global restrictions, refunds and chargeback requests have become a large part of airline operation. The complexity of embedded systems and risks such as cost, time and internal capacity has stifled innovation in this area.

But more than ever, travellers want reassurance that paying for travel plans that may need to change won’t result in frustrating procedures, lengthy conversations with airlines or unexpected expenses

Many airlines have been encouraging customers to reschedule or accept voucher-based compensation; however it is important to consider the customer experience and chance of repeat business that will come from delivering a good refund experience.

Payment Orchestration helps turn what could be a negative into a positive by enabling reconciliation and consolidation of online transactions we simplify the customer service experience by allowing your team to locate and address each individual transaction in a single dashboard.

Accessing this information in real-time and in one report removes unnecessary admin time and costs. This enables you to build more robust and automated processes which improves the speed of handling refunds and reinforces your credibility to ensure the relationship with your customers remains strong and they have the confidence to rebook or take a voucher option.

Improving the customer experience and the inherent risk of paying in advance for travel that is scheduled weeks or months later can also be managed using Payment Orchestration by integrating insurance products and Buy Now Pay Later (BNPL) options that spread the risk for customers by allowing them to make payments over a longer period of time. Split Payments allows customers to use multiple payment types across a single transaction, opening up more ways to pay for what is many times a large transaction.

Payment Orchestration can also facilitate promotions like a ‘price freeze’ to encourage customers to book immediately, rather than waiting to see whether prices drop closer to their departure date. 

4. Unlock the potential of airline retailing

Compared with other industries, airlines are playing a game of catch-up in retailing. Many airlines are limited in their ability to influence travellers and successfully retail across the entire customer journey because of siloed data, lack of customer insights, disparate distribution strategies and legacy technology.

According to McKinsey selling new products in new ways, either directly to customers or via intermediaries - could be worth $40 billion to airlines by 2030. Payments are a critical link between airlines and their customers and are vital to the ongoing success of retailing.

Intermediaries such as booking platforms and online travel agencies have already identified payments as one of the biggest opportunities for differentiation, with some larger players investing in fintech solutions to make the end-to-end payment journey seamless. 

Consumers expect to be able to pay for travel as easily as they pay for other products, and digital wallets, BNPL and frictionless check-out experiences that work on any device all have roles to play.

Payment Orchestration is a single system that can simultaneously access various payment methods including digital wallets and bank transfers, as well as internal payment methods like vouchers and loyalty points. This eliminates customer pain points and, as a result, reduces cart abandonment.  

Fly high with Velocity

Payments represent a major financial investment for airlines – the industry spends over $20 billion on payment costs, amounting to about 3% of airlines' total revenue and 78% of the industry's net profit. Deployed correctly, payments can dramatically improve the customer experience and boost profits for airlines.

The right Payment Orchestration partner is just that, a partner. By giving you a comprehensive overview of your entire ecosystem, covering multiple global PSPs, we help you identify areas for improvement, opportunities for cost reduction or more efficient back-office operations. Our solution is fully deployed at some of the largest airlines in the world and has the added benefit of plugging straight into your existing core system to access 400+ card schemes, alternative payment methods, PSPs, acquirers and more.

Payment Orchestration is the key to complete payment freedom and flexibility. It’s time for airlines to get on board.

In the final blog of this series, we’ll look to the horizon at what the future has in store for airlines, and how they can make payments a strategic advantage in the years ahead.

Give freedom and flexibility to your passengers

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