Disrupting travel payments: from concept to reality

Could you elaborate a bit on the company’s inception and its role in helping to tackle the issue of complicated travel payments?

I came up with the idea behind eNett just over a decade ago, after a hotel chain asked me to help in streamlining its paper-based payment reconciliation systems.

When undertaking this project, I was shocked at how old fashioned and manual payment processes remained in the travel industry. Paying by credit card was the easiest solution but left the payer vulnerable to fraud and surcharges. And such payments would not integrate into the booking and accounting platforms, which is key to automation. It got me thinking: we needed a digital solution.

It became clear to me that inefficient and overly-complex payment processes were a huge issue in the travel industry and there was an opportunity to disrupt the market. That’s when I had my eureka moment about using Virtual Account Numbers (VANs) – a 16-digit automatically generated unique Mastercard number – to simplify payments between travel intermediaries and their suppliers.

How did you take “eNett VANs” from concept to reality?

Developing the concept was the easy bit, securing the funding to launch and grow the business was more challenging. The big break for eNett came in 2009, when we secured backing from Travelport, the multi-billion-dollar travel commerce platform. Winning the funding was a close call however my tenacity paid off as a few months later, Travelport and Optal (eNett’s other major shareholder) formed a joint venture. With Travelport’s backing, we were able to invest in the development of eNett VANs to solve the payment pain points of the global travel industry.

Some call eNett a “travel payments disruptor”. How is eNett a ‘disruptor’?

eNett certainly disrupted payment processes when it introduced Virtual Account Numbers (VANs) to the travel industry. Today, eNett is known for partnering with well-known travel agencies on a global scale to facilitate faster, easier and safer payments to their suppliers. Unlike traditional payment methods, eNett VANs integrates into agency workflows, making the entire payment process much quicker and more efficient.

In addition, because each 16-digit VAN allows the definition of different payment parameters, and is protected by the Mastercard guarantee, eNett VANs offer travel agents increased protection against the risks of fraud and supplier default – a major concern for 60% of travel intermediaries when making payments. Using VANs also helps travel agencies mitigate the costs associated with manual payment processing and complex reconciliation efforts which were found to cost European travel agencies EUR 215 million each year.

How is the mobile and wearable technology revolution changing the way travellers interact with travel suppliers?

Mobile has already fundamentally changed the way we work, live, and travel. In Britain the average person spends 2 hours and 28 minutes on their phone every day, in the US, an average of 2 hours 51 minutes, and in Singapore, an average of 3 hours.

Today, people expect instant services and solutions. They want to be able to research, purchase and pay on the go. This is particularly palpable in the travel industry – where last-minute flights are now booked in lunch-breaks, and itineraries are planned in airport lounges.

Data from mobiles and wearables can also be used to make personalised offers to travellers. Online travel agents (OTAs) are best placed to take advantage of this, given the wide range of travel, lodging, and experience offers they can draw from to select the offers most relevant in a given situation.

What do you see as being the most important developments in the methods used by fraudsters in the travel payments space?

In 2017, the estimated cost of fraud for travel intermediaries was USD 21 billion. By 2020, the cost of fraud is expected to exceed USD 25 billion – a rise that can, in part, be attributed to the ever-rising sophistication of fraudster tactics.

The ‘fake hotel’ scam is one particularly significant development in fraudster tactics targeting OTAs. This scam involves a fraudster listing fake properties on an OTA’s website and then using stolen credit card details to make bookings, often at highly inflated prices and in high volume. The unwitting OTA then makes a payment to the fake hotel, completing the transfer of value from the stolen card to the fraudster who had set up the fake hotel. The OTA will eventually receive a chargeback for amounts related to the stolen credit card and may attempt to contact the fake hotel or recover money, but they will find that the hotel and the fraudster will have disappeared, along with any money already transferred.

So how can OTAs protect themselves against sophisticated fraudster scams such as the ‘fake hotel’ scam? Firstly, it is essential that OTAs undertake the necessary due diligence on their suppliers – they need to be confident that their travel supplier really exists and are who they say they are. OTAs also need to ensure that their entire employee base (not just management) can identify the signs of an attack. For example, employees need to be aware that high volume bookings, at highly inflated prices on a newly listed property indicate suspicious behaviour and should be flagged. Finally, OTAs should use payment methods that incorporate control mechanism to lessen the risk of fraud, and include opportunities for recovery should fraud occur, such as eNett VANs.

About Anthony Hynes

Anthony Hynes has been Managing Director and CEO of eNett international since its inception in 2009. His career is characterised by innovation and entrepreneurial vision. Anthony has led eNett’s development from start-up to one of the world’s leading travel payment companies.

About eNett International

eNett International was established in 2009 to tackle the unique payment challenges affecting travel agencies. Combining decades of payment expertise with in-depth travel industry knowledge, eNett is a b2b payments disruptor – it’s Virtual Account Number (VAN) solution allowing travel agencies to make faster, easier and safer payments to their suppliers.