23 October 2024 SUNRATE, a global payments and treasury management platform, unveiled its latest white paper titled “Navigating the Complexities of Cross-Border B2B Travel Payments: Practical Insights for Travel Intermediaries” during Travel Tech Asia 2024, Asia’s premier travel technology trade show.
According to a report by Statista, the global revenue of the online travel market reached nearly $600 billion in 2023 and is projected to surpass $800 billion by 2028. Online transactions have become increasingly dominant, accounting for over two-thirds of total travel and tourism sales.
Despite the lucrative opportunities in this expanding market, travel intermediaries—such as Online Travel Agencies (OTAs), Travel Agencies (TAs), and Travel Management Companies (TMCs)—often grapple with significant challenges. High transaction costs, inefficiencies in payment processes, security risks, and the complexities of cross-border payments can adversely affect profitability and operational efficiency.
Moreover, as some travel intermediaries consolidate and offer payment solutions within their ecosystems, others must carefully select payment providers. This scrutiny is essential to safeguard operations from potential conflicts of interest and ensure the security of customer data.
Shawn Qin, Head of Card Business at SUNRATE, expressed the company’s commitment to addressing these issues. “We are pleased to present this comprehensive white paper, tailored specifically for travel intermediaries. At SUNRATE, we understand the unique challenges associated with managing B2B travel payments. Our goal is to offer practical and actionable advice to streamline payment processes, reduce costs, and enhance efficiency. As an agnostic and independent payment service provider, SUNRATE is committed to protecting the interests and data of its clients.”
The white paper outlines six critical issues impacting travel intermediaries:
Cross-Border Complexities: Navigating multiple currencies and regulatory environments presents significant costs and complexities for travel intermediaries, particularly concerning expensive processing fees for cross-border transactions.
High Transaction Costs: The significant costs associated with cross-border B2B travel payments can burden travel intermediaries, particularly given the volume of transactions and foreign exchange mark-ups.
Inefficiencies in Payment Processes: Traditional payment methods such as Automated Clearing Houses (ACH) and Airlines Reporting Corporation (ARC) expose intermediaries to financial risks due to their slow and error-prone nature. Many still rely on outdated practices like manual data entry for invoicing and direct hotel billing, increasing the likelihood of errors.
Security Concerns: Managing vast amounts of financial data poses inherent security risks, especially for intermediaries handling sensitive payment information across various platforms. Cybersecurity threats are prevalent, with many businesses facing fraud attempts annually.
Regulatory Compliance Challenges: The travel industry is heavily regulated, and maintaining compliance across different jurisdictions is complex. Failure to comply can result in fines and penalties, emphasizing the need for ongoing vigilance in adhering to regulatory changes.
Data Management and Reporting Difficulties: Effective data management is vital for intermediaries to make informed decisions. However, fragmented data systems can hinder businesses from achieving a cohesive view of their financial and operational performance, resulting in errors and missed opportunities.
The white paper also presents actionable recommendations for travel intermediaries, highlighting the key benefits and opportunities offered by modern payment solutions. By adopting these technologies, travel intermediaries can enhance operational efficiency, bolster security, ensure regulatory compliance, and better position themselves to thrive in an increasingly complex global market.
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