First Posted 25th February, 2021
Ai Editorial: Laurie Gablehouse, Travel Payment Strategies and Solutions, Ingenico ePayments and Mike Carlo, founder, XanderPay discussed several aspects during the #ATPS Payouts and B2B Payments Update.
26th February, 2021
The payment industry is complex, with multiple players involved in the processing of one transaction. The pressure that the pandemic brought on travel players pushed companies to evaluate their risk strategy, payment acceptance plans, costs etc.
Reflecting on what has transpired over the last 10 months or so, and lessons from #Covid19 for B2B payments and payouts, Laurie Gablehouse, Travel Payment Strategies and Solutions, Ingenico ePayments and Mike Carlo, founder, XanderPay and Board Member, HEDNA, discussed several aspects during the #ATPS Payouts and B2B Payments Update today:
- The pandemic has proven to be a blacklight showing all the dirty part of payment processing
- Understanding the flow of funds and working capital has long been underappreciated
- Industry was unprepared for acquirers to start withholding funds
- Risks of bankruptcy abound – probably for another year
- FX conversion complications – currency challenges
- Be wary of hype and speculation
- Need a payment continuity plan
In another session, Thomas Helldorff, Worldpay said, “Payment processing (is being thoroughly looked at) and is being considered as an opportunity i. e. to save money, improve upon efficiency and manage cash flow better.”
As witnessed over the past 10 months or so, the going hasn’t been easy for acquirers considering that their existing risk models weren’t enough for risk assessment. As for acquirers, Helldorff said it is vital to “estimate and manage risk”, and work out a diligent analysis to handle the same, incorporating real-time data for the same.
Acquirer strategy in airline payments – how to go about it?
Airlines are looking at supporting payment methods that customers value and prefer, and accordingly how to optimize acceptance rates and minimize cost.
In this context, acquirer strategy in airline payments has been a critical topic over the past 8-10 months.
An acquirer agnostic strategy, sustaining appropriate lines of credit, evaluating the cost of acceptance…these and many more aspects have been delved into by airlines.
“It is now clear more than ever before that if you are going to balance your risk, your credit, your cash flow, basically to have certain balance…it is imperative to (work with) multiple acquirers and (evaluate) options,” said Laurie.
It is being pointed out that the discussion is owing to card processing, but the #coronavirus pandemic has made one understand that it is not the only payment product available.
Laurie mentioned that the time is apt to consider what is being taken a “payment instrument” and “go beyond the card side of it”. The recommendation then would be to consider every aspect, even the regulatory ones, rather than putting all the eggs in one basket. Go deeper in terms of evaluating the prowess of a payment gateway and the reconciliation process.
Some other aspects to consider:
- How to offer the preferred payment method for each customer, in each market, for each channel?
- How to optimize the routing of each card transaction so that the payment gets authorized?
- How to integrate with acquirers, payment processers, fraud partners etc.?
By Ritesh Gupta,
Ai Team
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