Harness The Power of Payments: A new world of payments

Payments are changing – fast! Throughout the entire payments ecosystem, innovation is transforming both the types of payments passengers prefer and the way banks are operating. In the last of our airline series, we’ll be future-gazing to predict what changes airlines can expect in the payment space.

The combined effects of apps like Uber, the rise of fintech and, of course, the pandemic mean in the past few years’ airline payments have evolved from being a tactical consideration to a business strategy, and today payment options are a key differentiating factor for any travel business.

The continuing rise of alternative payment methods (APMs) like PayPal, Google Pay, and Apple Pay is a trend we expect to accelerate. Airlines need to embrace APMs with enthusiasm to match that of their customers or they risk losing business. Airlines that don’t offer passengers the opportunity to split payments - an increasingly popular choice for both card and APM payments - or pay in instalments will lose business to those that do.

CellPoint Digital’s Velocity Payment Orchestration Platform makes it easy to deploy and retract APMs with the click of a button. It also makes deploying Pay-by-Link simple, a method that reduces cart abandonment by providing a link to a checkout page to complete a transaction. We work closely with all Passenger Service System (PSS) providers to offer a seamless integration which results in less reliance on the PSS provider. We can then take over their payment strategy, or it can be driven through us for a significantly lower cost.

What else is on the horizon?

Airline success in the coming years will depend on offering a seamless customer experience, and this includes payments. Open Banking and PSD2 legislation can revolutionise how airlines manage money by offering customers a quick, secure and efficient way to pay directly from their bank accounts. This can help cut costs and streamline operations.

A trend that may become more popular in the future is "pay as you fly" programs, where customers only pay for their flight once it is confirmed to take off. This can increase customer protection and reduce the risk of cancellations and refunds. Lufthansa was the first to launch a "pay as you fly" program in 2021, but it is currently only available for corporate customers.

Finally, with airfares climbing, we may see more subscription programs in the airline industry. These programs can help to strengthen customer engagement and retention and can include perks such as fixed-rate fares, free companions on flights, and no change fees. American Airlines, for example, has launched its AirPass subscription, which starts at $10,000 a year.

Overall, the future of payments in the airline industry is highly dynamic and constantly changing. To stay ahead of the curve, airlines need to embrace new technologies and trends and offer customers the most convenient, secure, and efficient payment options possible.

Problem-solving through payment innovation

Airlines have historically found it difficult to turn payments from a cost to a profit because of incredibly complex systems and an abundance of regulations to wrangle. Many airlines have multi-acquirer setups, sophisticated products, and a specific need for back-office improvements all built on legacy technology that makes it challenging to push innovation. CellPoint Digital brings a pragmatic approach to payment enablement by leveraging data and analytics that uncover valuable insights across current and future markets.

Our platform provides you with the ability to fight fraud more effectively, layering multiple fraud-fighting solutions together to achieve the best results. These advanced fraud prevention solutions mean transactions can be analyzed in less than a second, evaluating data from current and past transactions to see if they are genuine or fraudulent. Velocity uses the latest fraud management technology and data from 141 billion+ transactions to help airlines increase acceptance rates, lower review rates, and boost their bottom line.

Future-proofing profits

Airline success in the coming years will correlate directly to making the end-to-end customer experience seamless and that includes payments.

Payment Orchestration can help airlines future-proof profits by providing a seamless and efficient payment experience for customers. Here are a few ways in which it can do so:

Increased customer satisfaction: By offering a variety of alternative payment methods (APMs) such as e-wallets, mobile payments, and digital wallets, airlines can improve the customer experience and increase satisfaction. A study by Juniper Research found that by 2022, the number of mobile wallet users will reach 3.3 billion, accounting for over 70% of the global population.

Reduced costs: APMs can also help airlines reduce costs associated with accepting credit card payments. According to a study by the Nilson Report, the global average cost of accepting a credit card payment is 2.5% per transaction. By accepting APMs, airlines can reduce this cost, ultimately increasing profits.

Increased revenue: Payment Orchestration enables airlines to accept a wide range of APMs, catering to a diverse customer base and opening up new markets. This can lead to increased revenue as more customers are able to purchase tickets and make in-flight purchases.

Improved security: Payment Orchestration provides a secure and compliant environment for payment processing, reducing the risk of fraud and chargebacks. This is particularly important in the airline industry, where the risk of fraud is high due to the large number of transactions and the need to comply with multiple regulations.

Increased scalability: Payment Orchestration platforms are highly scalable and can handle a large volume of transactions, which is essential for airlines as they handle a large number of payments daily. This ensures that the system can handle peak traffic and can grow with the airline's business.

Overall, Payment Orchestration can help airlines future-proof profits by providing a seamless and efficient payment experience for customers, reducing costs, increasing revenue, improving security and scaling with the business.

With our Leading Payment Orchestration Platform, Velocity we can also maximise your global reach and simplify the technical heavy lift of dealing with individual payment providers to keep pace with the exciting new technologies that lie ahead.

As the world of payments continues to evolve, Payment Orchestration will be key in helping airlines unlock the true potential of payments to save money as well as generate revenue.

Take your payment strategy to new heights

Set-up an introductory conversation about how Payment Orchestration can deliver an excellent passenger experience.