Today's travel payment ecosystem resembles a complex supply chain more than a simple transaction flow. Each payment interaction involves multiple stakeholders, currencies, and methods, creating an intricate web of dependencies that directly impact both operational efficiency and customer experience.
This complexity comes at a price. Our analysis shows that airlines typically manage relationships with eight-ten payment service providers, each with their own integration, reconciliation processes, and commercial agreements. The resulting fragmentation creates a cascade of challenges – soaring operational costs from managing multiple vendor relationships, increased risk of payment failures due to system incompatibilities, lost revenue from sub-optimal payment routing, and slower time-to-market for new payment methods and services.
The most forward-thinking travel organisations are now treating their payment supply chain as a strategic asset. This shift in mindset is crucial. Just as we optimised physical supply chains for efficiency and resilience, we must now apply the same strategic thinking to our payment operations.
Modern payment orchestration brings a new dimension to travel commerce: payment intelligence. This intelligence transforms payment operations from a back-office function into a strategic enabler of growth. Through real-time routing, decisions based on transaction success probability, dynamic currency optimisation across markets, and automated retry logic that understands payment context, organisations can now leverage their payment data for strategic advantage. This intelligence extends to predictive analytics for fraud prevention and smart reconciliation across multiple payment streams, creating a comprehensive view of payment operations that drives business decisions.
The modern traveller's journey is increasingly defined by their payment experience. From the moment they book until their return home, payment interactions shape their perception of the travel brand. While we have traditionally viewed payments as a functional necessity, they have evolved to become a critical touchpoint in the customer journey.
Consider the frustration of a business traveller whose preferred payment method isn't available, or a leisure traveller unable to split payments for a family vacation. These aren't just payment failures – they are brand experience failures. Our internal research shows that 40% of customers abandon their travel purchases due to payment friction, while 78% are more likely to return to brands that remember and support their payment preferences.
The complexity of travel payments adds another layer to this challenge. A single journey might involve multiple currencies, payment methods, and timing requirements. A customer booking a vacation package expects to seamlessly combine credit card payments with loyalty points, travel credits, and alternative payment methods. They don't see – nor should they need to understand – the intricate orchestration required to make this happen.
The future of travel commerce demands a payment infrastructure that can evolve with the industry. Beyond handling complex multi-merchant scenarios, it must support dynamic pricing and real-time inventory management while enabling personalised payment experiences at scale. This infrastructure needs to adapt seamlessly to emerging payment methods and market requirements, facilitating the transition to modern retail models like Offer and Order.
The industry's move toward modern retail practices, exemplified by IATA's One Order initiative, demands a fundamentally different approach to payments. Success in this new paradigm requires flexible payment orchestration that can handle complex bundling, real-time payment optimisation across multiple merchants, and intelligent routing that understands the context of each transaction. The seamless integration of traditional and alternative payment methods becomes not just an operational requirement but a strategic necessity.
For C-suite executives, the path forward begins with a fundamental reassessment of payment operations. This means understanding the true cost and complexity of existing payment infrastructure, developing a strategic roadmap for payment transformation, and building internal alignment around payments as a strategic asset. The key is investing in technology that enables rather than constrains growth.
The next few years will be transformative for travel commerce. Those who invest in modernising their payment supply chain today will be better positioned to capture tomorrow's opportunities. This isn't just about keeping pace with change – it is about creating the foundation for future innovation and growth.
The question for travel industry leaders isn't whether to transform their payment supply chain, but how quickly they can make this strategic shift. In an industry where margins are tight and competition is fierce, the payment supply chain could be your next source of competitive advantage.
The future of travel commerce will be defined by those who recognise that payments are not just about processing transactions – they're about enabling business transformation.
Kristian is a visionary entrepreneur and esteemed leader at the forefront of digital transformation and payment solutions. With an extensive background in enterprise business, including notable positions at Amdahl, Network Appliance, and Sun Microsystems, he co-founded CellPoint Digital in 2007. As CEO, Kristian's strategic acumen and operational expertise drive the company's innovation and unwavering commitment to supporting customers in the travel sector. His profound understanding of the payments landscape and ability to navigate complex challenges have positioned CellPoint Digital as a differentiator in the industry.
CellPoint Digital, the inventor and leader of Payment Orchestration, is a pioneer in shaping the future of payments, with a focus on the airline and travel industry, using it’s cutting-edge Payment Orchestration Platform to enable customers to cut costs and grow revenues by streamlining payments between borders and using different payment methods – making payments work for them across all channels and markets.
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