The Importance of Establishing a Corporate Payment … · The Importance of Establishing a Corporate Payment Strategy 6 June 2017 ASTA Premium Business Summit – Washington D.C.

The Importance of

Establishing a Corporate

Payment Strategy 6 June 2017

ASTA Premium Business Summit – Washington D.C.

Presented by: Lori Schimenti Director, Sales Implementation - UATP

The High Cost of

Travel Payments

2

Record Number Fees

3

›Airlines pay more than USD 7Billon annually to

process electronic payments1.

1 Payment Unsettled: Cost, Opportunity and

Disruption in Travel’s Complex Payment

Landscape

U.S. Airline Operating Expenses…

4

01020304050607080

60

21 20 15 10 10 8 Billions

Source: U.S. Department of Transportation

…now factor in Credit Card and Bank Fees

5

0

10

20

30

40

50

60

70

80

60

21 20 15 11 10

4 3 Billions

5th Highest Expense

Block!

Source: U.S. Department of Transportation

Disruptive Changes in

Travel Payments

6

Phocuswright Study: Corporate Buyer Outlook on Payment Methods

› Mobile

› Prepaid

› Single-use credit cards

› Alternative Forms of Payment (AFPs)

› Gift cards/Vouchers

7

Mobile and Alternative Forms of Payment (AFPs)

8

* Payment Unsettled: Cost, Opportunity and Disruption in

Travel’s Complex Payment Landscape, March 2013

Future of the Payment Industry

› Bank credit cards remain the most popular form of payment. AFPs are changing the percentages though and will continue to do so. By 2019, the percentage of total eCommerce is forecasted to hit:

› Charge Cards:$41B

› Credit Cards: $577B

› Debit Cards: $413B

› Prepaid Cards: $39B

9

Mobile Payments and TMCs

› According to a study by Bank of America, when Americans turn to their mobile device to shop, 51 percent use it to book travel

› Digital travel-related transactions are estimated to rise to $762 billion by 2019, according to eMarketer, with much of the growth occurring in Latin America and Asia

› Of all direct online bookings, 30% are made on mobile devices (tablets and smartphones). 31% of smartphone users claim they research travel on their mobile devices (Mobile Path to Purchase)

10 https://www.rezdy.com/resource/travel-statistics-for-tour-operators/

Near-Field Communication

“NFC (near-field communication) allows two devices placed within a few centimeters of each other to exchange data. In order for this to work, both devices must be equipped with an NFC chip.”

11

“Apple Pay Checks In to Marriott – First Hotel Company to Offer the Service to Its Guests”

Corporate Buyer Outlook on Payment Methods

12

* Payment Unsettled: Cost, Opportunity and Disruption in

Travel’s Complex Payment Landscape, March 2013

VANs (Virtual Account Numbers)

13

› Allows TMC to generate a one-time use credit card number that ties back to another credit card or central bill account.

› Benefits:

1. Control, good for employees that don’t need a full-time corporate card

2. Improved acceptance (some VANs can be generated cross-network)

3. Easy Reconciliation

Corporate Payment

Strategy Takeaways

14

Corporate Payment Strategy Takeaways

15

› Disruptive Changes in payments affects Suppliers, TMCs and their respective customers

› Corporate customers and TMCs should embrace change & leverage technology

› Determine / Develop a Payment Strategy that provides:

› Savings / Cost Control

› Enhanced Reporting

› Reconciliation

› Streamlined Experience for Travelers

› Changes in the U.S. regulatory environment and advancements such as NFC and VANs will dramatically change the travel industry and travel experience

Q&A

16