It may not seem like it since payments occur in the background on both the business’s and traveler’s end, but dedicated payment processing systems are the foundation of any quality travel business.
The name is confusing, too. Despite what it sounds like, it’s not just about processing transactions and receiving cash.
Instead, it’s about navigating the competitive travel industry and staying afloat while ensuring you’re engaging happy, repeat customers who love your travel products or services.
Case in point: many travel-specific issues stem from seasonal fluctuations in demand, high transaction values, and the need for multiple currencies.
The solution to those problems? A specialized travel payment solution that can address industry-specific obstacles and aid smooth operations.
If you’re unfamiliar with what a travel payment system is, keep scrolling to learn more about what they are, why (and when) you’d need them, and what are the benefits of having a high-risk payment service provider by your side.
Travel Payment Systems Explained
Travel payment systems are specialized solutions that offer catered services to businesses in the travel industry.
These service providers:
Handle transaction processing
Offer high-risk merchant accounts
Connect merchants to suitable acquirers
Help accommodate your specific audience with multiple currencies or payment methods
Equip you with needed tools for fraud and chargeback prevention
By partnering with a provider knowledgeable of the sector’s main payment issues and higher overall risks, your travel agency or business can improve transaction efficiency while also growing its reach and ensuring compliance with the regulatory terms.
Who doesn’t want that?
Why You Should Use Travel Payment Systems vs. General Accounts
Despite all travel merchants being in the same industry, some travel companies are eligible for a general merchant account and standard processing solutions, while others are simply not.
That’s because specific business models in the trade are associated with an increased risk of fraud as well as chargebacks, especially if a business offers the BNPL (Buy Now Pay Later) payment method.
A great payment gateway can help you offer a seamless checkout experience. You can save the checkout information for later, which is helpful to have in any business, but especially helpful for travel agencies and similar travel-related businesses. Offering the 'buy now, pay later' option can help increase sales and customer satisfaction.
Therefore, depending on your categorization, you might need a dedicated high-risk merchant account, a specialized solution, or, at the very least, payment systems designed with the risks of the travel industry in mind.
Why would a travel merchant need such services, aside from smoother transactions and a more targeted approach? Let’s unpack this.
1. Provide a Simple Checkout Experience
Specialized travel payment systems can help you streamline the payment process and overall customer experience by making the purchase process quicker and easier.
A customer typically looks for efficiency and ease of completing a purchase. Features like one-click payments and saved traveler information can significantly increase conversion.
Research shows that eliminating the dreaded data entries and offering payment methods like e-wallets, for instance, lowers checkout abandonment.
2. Offer More (Or Better) Features to Boost Revenue
A simple checkout experience subsequently leads to a boost in revenue (if done right, that is!). This is a key element to growth as a travel service distributor.
Moreover, as many travel agencies need to cater to a very large audience, it’s important to cater to those customers by offering unique and varied payment methods in multiple currencies.
In addition, a quality payment system will allow you to offer more value along with higher-quality checkout and payment experiences.
For example, with the right travel payment system, you’d be able to offer more up-sell opportunities that are integrated within the payment process itself.
Some up-selling techniques to use include:
Travel insurance
Activity add-ons
Extra days
Transfer bookings
Accommodation upgrades
Meal bundles
3. Invest in Scalable Services That Grow With You
Quality, travel-specific services should be able to grow as your business grows by helping you:
Increase your transaction volumes
Expand into new markets
Offer more (which means gaining more)
That’s why payment service providers like FastoPayments can make the maintenance of your high-risk travel merchant account a lot easier.
With FastoPayments’s gateway, for example, we’ve enabled access to real-time transaction logs, in-depth reports, and a merchant dashboard that provides you with a comprehensive overview of your performance metrics.
On top of that, you’ll be accompanied by a team of payment experts eager to help you solve any issue at any time.
4. Get Fraud Protection Tailored for Travel Transactions
The high value of travel transactions, the volume of payments, the international nature of most bookings, and the personal data being exchanged all require advanced fraud detection and prevention tools that only specialized payment service providers can offer.
Don’t sleep on this, even though it might seem like a simple feature. It not only helps protect your business from data leaks and cyber threats, but it also helps protect your customers by ensuring their funds are being transferred securely and personal information is being handled with care.
The right fraud prevention tools, specific to the travel industry, can also help with risk management by providing you with chargeback alerts, for example. These alerts give you time to resolve a dispute before it turns into a chargeback.
5. Access to Global Markets (And More Customers)
With payment systems designed for the travel industry, you’ll have the advantage of being able to expand into and access global markets by offering cross-border payment methods and different currencies.
This helps if you serve or want to reach an international clientele, but you don’t have to work with international customers to benefit from having more streamlined, global payment options.
If you are, though, it’s almost like you’re interacting with your customers in their native tongue, which will help build customer trust.
6. Much Easier & Better Cash Flow Management
Dedicated merchant services for travel agencies can also help manage cash flow and offer deeper insights into revenue forecasting.
The features designed for smooth money management facilitate minimal settlement times and faster reporting with tools that surpass human capabilities.
Why is this so important?
Nowadays, people expect immediate transfers without excess “pending” time. So, being able to conduct instant transfers is crucial for customer satisfaction.
This is great because it enhances the experience for your users and for you as a travel merchant. Having direct access to your funds will also make managing them easier.
7. Dedicated Support and Expertise in Travel Payments
We mentioned this above, but it’s so important it deserves its own section.
Having a support team that’s experienced in high-risk industries and knowledgeable in travel-specific payment issues is, quite honestly, indispensable.
Quick thinking and a solution-oriented approach are key to navigating the industry’s ever-changing and varying regulations.
You’ll want that expertise when it’s time to deal with failed transactions and resolve dispute claims.
At FastoPayments, we take pride in staying current with the latest travel regulations. We work to build payment optimization strategies, solve payment-related problems, and assist with any doubts.
The problems that kept coming up for us had to do with unreliable payouts, which simply can't keep happening if you’re a high-risk merchant in a highly dynamic regulatory industry. We also had issues with low acceptance rates on cards and acquirers that weren’t making anything easier on us. Essentially, we were just looking for a gateway we could rely on, who would help eliminate excess downtime due to problems that could be solved fast by an expert in the high-risk payment industry. FastoPayments’s team exceeded our expectations with their reliability, great communication, and responsiveness. They have always been there for us whenever we’ve needed help solving an issue and they’ve been super supportive the whole way through.
What Any Great Travel Payment System Should Have
As mentioned above, not all payment systems are created equally, and the same goes for the purpose and aim they serve. That’s important to keep in mind because for travel agencies or travel-related companies to thrive, the chosen payment provider has to be able to go beyond just facilitating transactions.
Below, we’ve broken down the key elements that any great payment platform for your travel business should have.
Access to In-Depth Business & Financial Information
Having an overview of specifics, including transaction reports, customer insights, and market trends, is key to making informed decisions as a travel merchant.
Access to comprehensive data about your business, along with general industry insights, can help you tailor the service you provide to your target market.
These insights can also help you manage your finances and predict revenues, as well as assist in coming up with marketing strategies by better understanding customer behavior.
Want to experience what this looks like for yourself?
At FastoPayments, we’re building an all-inclusive merchant dashboard for the businesses we work with. This will provide our merchants with an enhanced understanding of the transaction processing side of their business (and much more!).
The Ability to Automate Repetitive Tasks
Automation within a payment system can save significant time for high-risk merchants in any industry. This, in turn, can help avoid significant financial losses that might come from excessive downtime caused by technical errors.
Tasks that can be handed over to AI-driven systems, for example, can consequently reduce the same errors by outperforming human capabilities in situations where time is of the essence.
Nowadays, tedious yet necessary daily tasks like invoicing, sending out payment reminders, account reconciliations, and even fraud checks can all be conducted by machine learning systems.
Your travel payment system should be able to automate this kind of stuff to free up time for staff, leaving more time to focus on more strategic and customer-focused activities. The result? Improved operational efficiency and reduced overhead costs.
With FastoPayments’s tailored solutions, you can check all the mundane tasks off your to-do list as we’ve incorporated tools that automate all of the aforementioned tasks, from AI-driven transaction monitoring to automated invoices, fraud prevention, and more.
Auto-Billing Capabilities
Auto-billing features have become an absolute necessity for travel businesses today, as many companies in the trade offer subscription-based services, recurring payments, and payment plans for pricey trips.
The mere volume of these purchases begs for automation, as sending out invoices or payment reminders manually isn’t sustainable—especially as a growing business.
Auto-billing can also help you track cash flow consistency by reducing missed or late payments and enhancing the customer experience and loyalty.
Automating billing as a travel business is still a tough task, so you'll likely need to build it into your accounting system or an acquirer's software. The biggest obstacle to overcome here is that you typically need to code something on your end to set up automated systems, so ensure you're working with an experienced provider who knows what they're doing
Easily Embeddable Booking Functions
Opting for a payment service provider who can integrate booking and payment systems directly into your travel business’s website or mobile app is perhaps the best way to ensure your customers make the purchase and do so at the time of purchase (instead of abandoning the checkout page).
Confusing third-party platforms, repeated data entries, and complicated payment options often cause customers to exit without finishing their initial purchase.
Having a seamlessly integrated payment system can be a game-changer here since travel bookings are often spur-of-the-moment decisions. Hence, user-friendliness and smooth booking procedures can massively improve your turnover and revenue at the end of the day.
Great (And Knowledgable) Support
Finally, as mentioned, having a great support team in a trade like the travel industry is often what separates the good from the great.
Especially in a sector where merchants often face challenges that require expert knowledge and timely solutions, it can honestly make or break your business.
Having access to specialist guidance can help travel businesses:
Implement best practices for payment processing
Quickly resolve any issues that arise
Minimize disruption to their services
FastoPayments’s team consists of six industry professionals whose top priority is understanding the intricate problems of all high-risk merchants.
Untangling such challenges drives us, and problem-solving is second nature.
So, Should You Get a High-Risk Travel Merchant Account?
The short answer is yes, you should get a high-risk travel merchant account!
These accounts are designed to handle the specific risks of the travel sector. These risks include high-value tickets, high rates of chargebacks, cross-border transactions, broad target markets, and susceptibility to fraud. A standard merchant account simply isn’t made for these potential risks.
Furthermore, a travel merchant account comes with extra features that will help you maintain a healthy business, provide advanced fraud protection and increased security, and grow your reach safely.
What’s the Best Travel Payment Solution for High-Risk Businesses?
For payment gateway solutions from a provider who understands the dynamic needs of travel agencies, get a free, no-obligation quote for a travel merchant account here.
Whether you’re a new travel agency or have been serving travelers for years, we’ll review your business information and get back to you as soon as possible.
