Payment Methods

How Payments Makes Online Travel Sites Worth The Trip

It’s the peak travel season, and online travel sites have a number of pressures to manage: the economy, airline strikes, keeping up with the latest in tech and even the weather (Phoenix, we’re looking at you!). That’s before, Paysafe says, the ever-shifting payments sands kick in: rising fraud, gaps between when a consumer books, when they take the trip and when the agent gets paid and accommodating the growing number of payments methods that consumers expect to see at checkout. Here are the five payments challenges that Paysafe says online travel sites need to overcome to make the journey worth the trip.

Summer might mean vacation for you, but for travel agents, it’s crunch time, adding volume to what can already be a very delicate equation. Even in the quiet seasons, the online travel market is susceptible to the trade winds, and they don’t always blow in agents’ favor. It can be buffeted dramatically by shifts in the global economy, emerging technologies and even factors as arbitrary as the weather.

But what hurts a business (especially a small one) more than an October snowstorm is when online fraudsters use CNP transactions to steal their services. Or when they lose international deals because they’re not accepting the latest and greatest form of digital payment.

Both of these fall within the top five challenges facing modern travel agents, according to a list compiled by online global payments company Paysafe. The company has been front and center through the industry transformation since 1996 and has a few tips to keep agents from washing out with that turquoise Caribbean tide.

The End of Excessive Card Surcharges

Travel companies have historically been some of the worst offenders for drip pricing, a technique used by online retailers whereby a headline price is advertised at the beginning of the purchase process, and additional fees — such as card surcharges — that are added later in the process to inflate the final cost.

Good news for consumers: as of January 2018, that’s not going to be a thing anymore. A new law is going into effect that will prohibit agents from charging customers fees for using their credit or debit card. But that’s not such good news for the agents, and some may opt to introduce booking fees or other incentives to discourage customers from using cards.

Until a few years ago, card surcharges were big business in the travel industry, with the “add-ons” often worth more than the product being sold. This was particularly true for lower-cost bookings, such as car rentals, short stays and flights.

So-called “cheap flight” operators were once notorious for drip pricing, with the Office of Fair Trading (OFT) estimating that the airline industry alone was charging consumers £300 million a year (that’s $379,672,500 USD) in card surcharges at its peak.

In 2013, new limits were set on the amount merchants were legally allowed to charge customers for paying by credit or debit card, and come 2018, that amount will be slashed to zero.

The Rise of CNP Fraud

According to Europol, the European Union’s law enforcement agency, the airline industry loses nearly a billion pounds ($1.3 billion USD) every year as a result of card-not-present (CNP) online fraudulent ticket purchases. In October 2016, nearly 200 individuals were arrested as part of a major international sting. Forty-three countries, 75 airlines and eight online travel agencies were involved in the fraud.

Fraud is always bad news, but the stakes can be even higher for smaller operators who may have fewer contingency funds. There’s really no way around it: Online travel agents need to enlist a payments-processing partner that offers state-of-the-art fraud mitigation tools, understands the unique set of risks affecting the travel industry and takes a proactive approach in identifying suspicious transactions — all so risks can be extinguished before they become threats.

Consumer Demand and the Globalization of Travel

More and more travelers are looking for their next big adventure, and thanks to the global travel culture, trips are getting easier than ever to find (and afford). This presents travel agents with ample new opportunities, but it also introduces significant new challenges.

Travel agents looking to expand into new territories must have the flexibility to handle a number of different payment methods, many of them entirely new. Cards are still king in most of the world, but eWallets are gaining traction, particularly in Asia and the Pacific. If agents can’t take payments in a region’s most popular form, they risk losing that market altogether.

Globalization also means that agents must navigate uncharted legal and regulatory landscapes. This is another area in which choosing the right payments processor makes a huge difference. The experts can provide everything an agent needs to accept and process payments globally, and in a secure and compliant environment.

Complex Cross-Border B2B Payments

It’s impossible to do the work of a travel agent without the ability to exchange money, what with global suppliers dispersed across various countries and currencies. But doing that with minimal risk, cost and regulatory headaches is no small feat, and factors like fluctuating FX rates, geopolitical shake-ups, lengthy settlement times, hefty transaction fees and ever-evolving fraud risks make it even more complex. This is another area in which teaming up with a reputable payment service provider is key.

Consumer Protection

When consumers pay for a vacation, their funds are held in a trust account until the travel agent delivers on its end of the contract — that is, the trip as described. This is done in accordance with The Package Travel, Package Holidays and Package Tours Regulations 1992.

The trust account protects consumers financially in case the travel agent goes out of business or something else goes wrong. But for the agent, it introduces a wide gap between taking a booking and getting paid.


Agents can no longer get away with not offering a wide range of payment methods, around-the-clock support and best-in-class fraud and risk management.

Payments are a critical part of the consumer experience yet are often seen as less of a priority than other consumer-facing business assets, like websites, mobile apps or a social media presence. For forward-thinking travel agents looking to stay ahead in an extremely competitive market, a payment system that not only works, but is flexible and primed for growth, is essential.

By working with an acquirer that understands the complexities of the travel supply chain and offers all the essential elements to support growth within the sector, travel agents can turn would-be challenges into profitable opportunities.


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The Which Apps Do They Want Study analyzes survey data collected from 1,045 American consumers to learn how they use merchant apps to enhance in-store shopping experiences, and their interest in downloading more in the future. Our research covered consumers’ usage of in-app features like loyalty and rewards offerings and in-store navigation, helping to assess how merchants can design apps to distinguish themselves from competitors.

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