Driving innovation from within: A sustainable new model for airline payments

In 2013, Vijay Govindarajan and Jatin Desai wrote in the Harvard Business Review: ‘Any CEO can tell you that finding ideas is not always the problem. The real issue is selecting and spreading the best ideas, testing quickly, and executing flawlessly’. Nearly a decade on, this statement still holds true. As the CEO of a travel payments company, finding new ideas is not always a challenge. The EUR 230 billion travel sector is, still to this day, saddled with slow-moving, monolithic technology and payment platforms. But what if we could use the travel industry’s monolithic platforms to our advantage? 

Constraints breed creativity

In Q2 of 2021, Ixaris did just that with the launch of the Ixaris Card and a sustainable new model for airline payments. 

The Ixaris Card represents an innovation that was driven from within in two senses. Firstly, this new type of virtual card (and the sustainable new model for airline payments it will drive) was born out of Ixaris’ culture of intrapreneurship. That is, of driving innovation within our organisation. Secondly, the Ixaris Card is powered by Universal Air Travel Plan (UATP): a card scheme owned by the world’s airlines. It is therefore also, in this sense, an innovation driven from within the airline industry. 

The term intrapreneur was coined by Gifford Pinchot III in 1987 and described as ‘employees who do for corporate innovation what an entrepreneur does for his or her start-up’. Ixaris has a strong track record of supporting a culture of intrapreneurship, and this sets us up to be particularly resilient through this past extraordinary year. Together with our peers in payments and travel, I am not afraid to admit that Ixaris became even more resourceful by necessity in 2020. Constraint breeds creativity, and COVID-19 served the travel industry with its fair share of constraints. Intrapreneurs at Ixaris took this opportunity to develop radical innovations in-house, using our existing relationships and the many tools already at our disposal to create novel, disruptive solutions like the Ixaris Card. 

Delivering sustainability at a critical time for airlines 

The Ixaris Card is a new virtual card for airline payments, powered by UATP – a low-cost payment network, which made history by offering the first internationally valid charge card, the ‘Air Travel Card’, in 1936. This was the forerunner of the modern credit card — and so significant to financial history that it has earned a place in the Smithsonian’s National Air and Space Museum in Washington DC!

Turning our focus back to today, traditional card payments offer travel agents and online travel agents (OTAs) financial incentives for bookings, at the cost of eating into airlines’ already razor-thin margins. This has led airlines to surcharge or decline card payments, and even levy fines to OTAs, decreasing airlines’ distribution options and fracturing industry relationships.

The Ixaris Card removes intermediaries in the payment flow and gives airlines control to design transparent flexible incentives for OTAs based on routes, seasonality, business volumes, and more. And, since UATP is owned by the world’s airlines (which are all wired to accept payments through the UATP network) unlike other payment methods, Ixaris Card acceptance is also guaranteed.

Travel agents and OTAs can use the Ixaris Card to pay participating airlines through the Ixaris Payments virtual card platform. Airlines’ funds are settled faster via daily bank transfers, while agents receive swift financial rewards for increasing airline distribution and revenue. To tap into the Ixaris Card’s benefits, airlines and agents enter into a mutual agreement defining incentive terms and accepted currencies. This sustainable payment model, which will strengthen the historically unbalanced relationship between airlines and agents, is registered with the IATA TIP (Transparency in Payments) programme, and early adopters include Air Europa and Mystifly.

The launch of the Ixaris Card comes at an especially critical time for airlines. While the industry’s recovery picks up steam, airlines must continue to eye innovative cost and efficiency measures as keys to long-term recovery and resiliency. 

Final notes: New opportunities for a bright future

The Ixaris Card also represents an overlooked opportunity that Ixaris’ intrapreneurial spirit was key to tapping. A culture that supports intrapreneurship isn’t created by writing a strategic plan, or by declaring it on a company all-hands Zoom, or by hosting a ‘Shark Tank’-style team building activity. It’s built gradually, over time, through the approaches and actions of leaders. It’s a long haul game, but it’s never too late to start. The first step is finding and recognising intrapreneurs from within your team, and in my capacity as CEO of Ixaris, I am pleased to say that we have been successful in doing just that. 

Following Ixaris’ announcement that it had entered a definitive agreement to be acquired by Nium, I am more confident than ever in Ixaris’ ability to find overlooked opportunities that help  the travel sector bounce back across the globe. As part of the Nium family, I also look forward to continuing to spot and support intrapreneurs  (or as Pinchott also referred to them, ‘dreamers who do’) as they drive innovation and shake up payments from within. 

About Mark Anthony Spiteri

CEO Mark Anthony joined Ixaris Group 16 years ago as a junior developer. Today Mark Anthony is a seasoned player in the payments sphere, leading a team of over 90 people in Ixaris’ UK and Malta offices. As a pragmatic, resourceful fintech leader, Mark Anthony brings tactical solutions to complex operational challenges, working with employees, customers, and partners to drive business transformation and industry-leading innovation. Combining an intrapreneurial mindset with technical experience and knowledge, Mark identifies the key elements that turn an organisation’s wheels — and employs strategic perspective to steer it through the finish line.

About Ixaris

Ixaris is a payment optimisation company with an extensive portfolio of Mastercard, Visa, and UATP virtual cards. From launching Europe's first virtual cards to shaping the future of travel payments, innovation is in Ixaris' DNA. Ixaris group companies are based in London and Malta.