Travel agents globally are estimated to be losing $1.5 billion each year by sticking to manual payments processing due to fears over the cost of using credit cards.
Agents losing $1.5bn annually due to fear of payments automation
Travel agents globally are estimated to be losing $1.5 billion each year by sticking to manual payments processing due to fears over the cost of using credit cards.
Research by PhoCusWright and eNett estimated that companies are incurring costs of between $300 and $6,000 per week by manually processing payments.
However, using credit cards instead of alternative payment methods works out to be 37% cheaper, according to the research.
It was claimed firms have a misconception about the cost of credit cards due to merchant fees and airline charges.
Anthony Haynes, managing director and chief executive of eNett, the joint venture between Travelport and PSP International, said:
“The true cost of payments is a mystery for many travel companies because hidden costs and risks often skew the picture.
“We’re releasing three whitepapers over the coming weeks as a series to help the industry take a wider view of payment costs.
“The research sheds light on just how much time and resource the industry is outlaying through use of out-dated and inefficient payment and reconciliation processes as well as the costs of supplier default and fraud.”
Virtual payment cards or Virtual Account Numbers (VANs) are being touted as a way for firms to reduce their costs and to more efficiently pay suppliers and combat fraud.
The eNett PhoCusWright study found 40% of the travel agency sector continues to use old manual processing methods without properly evaluating the cost.
And suppliers like hotels were also found to be employing on average 17 people to process payments spending up to 18 hours per week.
