In a significant step for the aviation industry, IATA (International Air Transport Association) has partnered with Outpayce to enable airlines to accept global account-to-account payments. This collaboration signals a shift towards more streamlined payment methods in travel, providing benefits that include reduced processing costs and enhanced transaction security.
Outpayce is known for processing a staggering USD $160 billion in travel payments annually. The partnership introduces IATA Pay, a system that allows travelers to debit their bank accounts directly for online air ticket purchases. This method leverages existing account-to-account transaction systems across various countries, including the Unified Payments Interface (UPI) in India, Ideal in the Netherlands, PIX in Brazil, and QR Ph in the Philippines.
Currently, IATA Pay is operational in over 30 countries and promises not only improved transaction speeds but also an increase in payment security. Compared to traditional card payments, which often involve multiple intermediaries, account-to-account payments eliminate these layers, resulting in more efficient processing.
When making a purchase on an airline’s website, travelers will now select their bank or scan a QR code relevant to their country during the checkout process. IATA facilitates the payment request, transferring funds directly from the customer’s bank account, with settlement to the airline occurring within 24 hours. This quick turnaround is particularly beneficial for airlines looking to optimize their cash flow.
Juan Antonio Rodriguez, Director of Financial Settlement Operations at IATA, spoke on the rising trend of account-to-account payments, highlighting the seamless experience it offers to travelers. He stated, “The trend towards account-to-account payments is gaining more momentum. It provides a seamless experience for passengers and offers airlines an attractive option for lowering payment acceptance costs.” This is a key factor for airlines that often face hefty fees from traditional payment processors.
Philippine Airlines has already implemented the IATA Pay system through Outpayce’s Xchange Payments Platform (XPP). Anna Isabel Bengzon, the airline’s Chief Financial Officer, has expressed enthusiasm for this new method: “We are pleased to now accept IATA Pay in the Philippines. It will provide our passengers with a more convenient and secure way of paying via QR code using their digital wallets, which is highly prevalent in the country.”
The flexibility of the XPP platform allows Philippine Airlines to intelligently process a diverse range of payment methods, enhancing the overall customer experience. Anna emphasized, “Moreover, we can access various payment methods and partners through XPP, with detailed analytics on the performance of payment flows and back-end reconciliation support.” This insight is essential for airlines seeking to refine their payment strategies based on consumer preferences and real-time data.
Jean-Christophe Lacour, Senior Vice President and Head of Product Management & Delivery at Outpayce, underscored the company’s commitment to expanding payment options available to travel companies. He noted, “We’re committed to helping travel companies accept the widest possible range of payment methods through a single connection to XPP. IATA Pay represents an interesting new option for the industry.” The introduction of self-service APIs, currently underway in pilot programs, is designed to simplify the connection process for partners to XPP, broadening the range of payment options available.
The marriage of IATA and Outpayce is poised to redefine the payment landscape for airlines. By providing travelers with a direct and simple way to pay, it also empowers airlines to manage payment processing more efficiently. This collaboration addresses a crucial pain point for airlines and travelers alike in an industry characterized by high costs and complex payment systems.
As global travel continues to rebound post-pandemic, the capabilities afforded by the IATA Pay system may well become a standard expectation among consumers. By streamlining payment methods and enhancing security, this partnership sets a precedent for how airlines can innovate in financial transactions while focusing on customer satisfaction.
The partnership between IATA and Outpayce represents a significant evolution in how airlines process payments. With the right tools and technology, airlines can enhance operational efficiency while providing travelers with a seamless booking experience. As the travel industry strives to adapt to the changing needs of consumers, initiatives like IATA Pay are crucial.