New online payment methods for travel provide alternatives to dominance of the credit card
On its "Global Online Travel Payment Snapshot 2014", yStats.com reports that credit and debit card dominate in the vast dynamic market of online payment for travel and lodging, while alternative payment methods are slowly making inroads
Global developments in online payments for online travel
One general trend in online travel is the increasing use of mobile devices to make reservations, especially by business travelers and consumers who book last minute trips. With the increasing use of smartphones and tablet computers for travel planning, payment methods have to adapt to the emerging trend in consumer practice. A third of airlines already plan to facilitate the use of mobile payments for booking purposes in the next two years. PayPal is already accepted by an increasing number of travel booking websites.
Online payment fraud is a major concern of online travel agencies and booking websites. Though only around 1% of online travel payments is fraudulent, considering the size of the market, this is a significant number. Industry compliance with established safety regulations and keeping consumers informed about secure payment can contribute to decreasing the occurrence and cost of payment fraud.
Another trend on the online travel payments is towards immediate payment at the time of booking of hotels. Though both prepayment and reservation held by card for later payment at the desk are present on such travel booking websites as Booking.com and Expedia.com, on other such as on Hotels.com pre-payment has become the dominant option.
Regional variations in online payment for flights and lodging
Though online travel is a global market, peculiarities of local payment environments influence travel payment practice. For example, budget airline Ryanair accepts direct debits on its website in Germany, where they are popular, and does not take surcharges on them. Online travel booking website Hotelurbano.com, for which the primary market is Brazil, accepts the local banking payment method Boleto Bancario, while Japan-based All Nippon Airways accepts cash payment at convenience stores, which is an accepted payment practice in Japan. US airline companies United Airlines and Delta Air Lines offer the delayed payment method Bill Me Later, a PayPal brand, for customers with a billing addresses in the USA.
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yStats.com has been committed to research up-to-date, objective and demand-based data on markets and competitors for top managers from various industries since 2005. Headquartered in Hamburg, Germany, the firm has a strong international focus and is specialized in secondary market research. In addition to offering reports on markets and competitors, yStats.com also carries out client-specific research. Clients include leading global enterprises from various industries including B2C E-Commerce, electronic payment systems, mail order and direct marketing, logistics, as well as banking and consulting.