- Airwallex and Skift research finds nearly two-thirds (66
percent) of travel executives believe inefficient payment systems
are harming their profits
- 70 percent find cross-border customer payments are more
challenging due to new payment methods, despite this activity
making up at least a quarter of their revenues
- Upgrading payment technology is a key focus, with 90 percent of
executives planning to make it a priority over the next 12
months
New research has revealed 66 percent of travel companies are
seeing their profit margins impacted by outdated or complicated
payment systems, with nine in 10 expected to prioritise modernising
their financial operations this year.
In a report released today by leading global payments and
financial platform, Airwallex, and travel research company, Skift,
the travel industry is also being challenged by shifting payment
preferences since the COVID-19 pandemic. While revenue from
cross-border payments is on the rise, the unprecedented diversity
of payment methods in different markets complicates transactions
for 70 percent of travel companies.
Commenting on the research findings Jack Zhang, Co-founder
and CEO at Airwallex, said, “As global travel continues to
boom, travel companies increasingly rely on quick and seamless
cross-border payments to surpass customer expectations at every
touchpoint. However, our latest study shows that slow and outdated
payment processes are increasing the cost of moving money
internationally, which is eating into their profits - modest at the
best of times.
Modernising their financial operations with a unified and
scalable payment solution will be critical to reducing the cost and
friction associated with managing cross-border transactions. For
smaller players, this can be what levels the playing field,
enabling them to compete with larger, more established
counterparts.”
Skift and Airwallex surveyed 473 travel executives in April 2024
across seven global markets — Australia, China, Hong Kong SAR,
Israel, Singapore, the United Kingdom and the United States. The
survey respondents confirmed that they make decisions about payment
processes and financial operations for a travel company across the
sector including online travel bookings, travel operators, tours
and activities, and destination management.
“Our survey of global travel executives uncovered new, unique
and even surprising insights into why unified payment and financial
systems are critical in meeting today's traveller expectations,"
said Rafat Ali, CEO and Founder of Skift. "Amid an
unprecedented rise in international tourism, the report intends to
give travel companies a framework to expand their knowledge base
and build more efficient, effective and profitable businesses
through modernised payment and financial operations systems."
The findings provide a unique perspective on the financial
challenges and opportunities that companies face as they grow and
operate on a global scale. It offers rare insight into the issues
travel businesses experience with end-to-end payments and financial
operations, especially with the growing trend of cross-border
transactions.
KEY FINDINGS
Travel customer payment preferences are shifting with local
payment methods being increasingly used
Credit cards, debit cards and digital wallets remain by far the
most common customer payment methods. However, travellers are
increasingly using local payment methods or peer-to-peer payment
apps, which can vary widely by market.
- 88 percent of travel executives agreed that there has been a
shift in how customers prefer to pay since the COVID-19
pandemic
- Local payment methods and peer-to-peer systems are also rapidly
gaining popularity, especially in Asia
- Handling a variety of payment types, across different markets,
is becoming increasingly complex for 70 percent of travel
companies
Cross-border transactions soar, but bring significant global
payment challenges
Cross-border transactions are now commonplace with nearly 40
percent of travel executives reporting half of their revenues to be
from international customer payments. Meeting different market
payment needs, foreign exchange (FX) fees, and managing multiple
supplier and vendor payments in numerous countries hinder travel
companies’ ability to expand their supplier or vendor network in
new markets.
- 75 percent of travel companies earn more than one-quarter of
their revenue from cross-border payments, while 88 percent of
companies frequently make payments to suppliers or vendors in
foreign currencies
- 67 percent of executives agreed that cross-border payments have
become more complicated due to the volatility of FX rates
- Managing multiple supplier and vendor payments in different
countries using existing payment and financial infrastructure and
reconciling bookings, payments, commissions and refunds data is a
key challenge for more than 50 percent of executives
Inefficient payment systems are detrimental to profits with
travel executives saying financial operational upgrades are a
priority
Challenges with payment systems, such as multi-currency payments
and settlements, fraud risk and other operational inefficiencies
are impacting travel companies.
- Nearly two-thirds of travel finance executives say that
outdated or complicated payment systems are directly impacting
their organisational efficiency and profit margins, with nine in 10
reporting at least a 2 percent erosion and over one-third losing 10
percent
- 90 percent of travel executives are prioritising upgrades to
payment and financial operations systems
- 80 percent of executives would be interested in an all-in-one
payment and financial operations platform
The full report and recommendations on how online travel
businesses can modernise their financial operations for global
success, can be read here.
NOTES TO MEDIA
Methodology:
Skift and Airwallex surveyed 473 travel executives in April 2024
across seven global markets — Australia, China, Hong Kong SAR,
Israel, Singapore, the United Kingdom and the United States.
To qualify for the survey, respondents confirmed that they make
decisions about payment processes and financial operations for a
travel company in one of the following sectors — online travel
booking, travel operators, tours and activities, or destination
management. Approximately 80 percent of respondents work for small-
to medium-sized travel companies, defined herein as those
comprising 20 to 600 employees.
For further information
If you have any questions or would like to request further
information, please contact press@airwallex.com.
About Airwallex
Airwallex is a leading global financial platform for modern
businesses, offering trusted solutions to manage everything from
payments, treasury and spend management to embedded finance. With
our proprietary infrastructure, Airwallex takes the friction out of
global payments and financial operations, empowering businesses of
all sizes to unlock new opportunities and grow beyond borders.
Proudly founded in Melbourne, Airwallex supports over 100,000
businesses globally and is trusted by brands such as Brex,
Rippling, Navan, Qantas, SHEIN and many more. For more information,
visit http://www.airwallex.com.
About Skift
Skift is the largest industry intelligence platform, providing
media, insights, and marketing to key sectors in travel. Through
news, research, conferences, exclusive interviews, strategic
sector-focused newsletters and more, Skift deciphers and defines
the global trends that matter to the marketers, strategists and
technologists shaping the industry.
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Airwallex press@airwallex.com