In travel, as in life, the shortest distance between two points usually offers the best rewards — in terms of speed to get where one wants to go and efficiency. So it is in payments, where technology is the faster way to get between points A and B.
A recent whitepaper by WEX, which provides payment solutions, including fleet cards, offered four recommendations tied to enhancing supplier payments. The traveling consumer, whether an individual on a leisure trip or corporate road warrior, has more choice at his or her fingertips than ever before.
The travel company, aiming to be comprehensive and add value to existing and would-be clients, must differentiate on something other than price. Reach is important, the firm found, and having a supplier payment strategy in place that is global in scope means that branching out into new regions (and relationships) becomes easier even as it becomes necessary.
In an interview with PYMNTS, Jim Pratt, senior vice president and general manager of virtual payments at the company, stated: “We see that some of the key payment issues that travel companies deal with have not really changed all that much since they were issues even as far back as the year 2000.” Key among those issues, according to the executive, has been cross-border payments, where traditional methodologies of payments for travel, conducted, say, through banks or wire, remain inefficient. As the whitepaper noted, currency pairings may be unexpectedly volatile, driving up expenses, tied, for example, to booking costs. Among other issues that round out top concerns, especially in travel, include fraud, said Pratt. Compliance in new regions remains top of mind.
For corporate travelers, WEX found that more long-haul flights are being pointed toward emerging markets in Asia, Africa, South America and the Middle East. Overall trends point to the continuance of technology making inroads into travel booking activity overall, as gross travel bookings were greater than 60 percent in Scandinavia and 57 percent in the United Kingdom.
Within the framework of growing cross-border transactions, far-flung travelers and compliance concerns, technology helps travel companies tackle supplier payments more effectively (as is the case with early bookings, tied in with prepaid inventory, which can dovetail to improve a travel company’s cash flow). But, in the case of corporate travel, the advent and continued adoption of v-cards have put a number of controls in place which can help efforts across all of these avenues. Virtual payments, said Pratt, offer a good way for companies to eliminate some of the liabilities in the field that could be troublesome, such as high credit limits (they can be tailored with v-cards) or merchant restrictions (to certain vendors or regions).