Improving upon CX, hiring the right people, curbing fraud, counting on data and infrastructure… a lot needs to be done to ensure an apt payment and fraud strategy is in place, writes Ai’s Ritesh Gupta. 10 points to consider.
30th August, 2021
You make a plan and then when you are about to pay, you drop off.
Travel merchants are digging deep to understand what is being preferred today when it comes to paying for a trip-related transaction. An incompetent digital payment strategy can impact a brand in a striking way considering the way digital commerce has shaped up in the last 18 months or so.
Certain aspects that need to be considered are:
1.What is hindering travellers from booking? Amadeus, in its recent survey, found that 81% of respondents said heightened “risk of cancellation is a barrier to booking travel” this year.
2. CX and conversion: Regardless of the COVID-19 crisis, the payments ecosystem continues to diversify, so it’s not about supporting one method of payment over another. It’s about having the flexibility to deploy new payment methods when customers demand them, and to be able to do so at minimal cost and maximum speed. Straightforward solutions – the kind consumers are conditioned to expect from their experience with ecommerce retail – must be implemented, like stored card capability, one-click payments, streamlined authentication with biometrics or split payment Also, it is important for travel merchants to focus on dynamic friction, a fraud prevention approach which focuses on behavioral and situational attributes to apply right friction to the right person at the right time.
3. Right people: The significance of hiring the right people as organizations try to curb various forms of e-commerce fraud must not be undermined. For instance, an executive pointed out, “Diversity (while recruiting people), specialized knowledge/ skills, and training and support (is key to curbing fraud”.
4. Is the `Pay When You Fly’ (PWYF) offering (paying a small deposit (around 15%) and then settling the balance a few weeks before travel) or ‘Buy Now Pay Later’ (BNPL) more popular? How are these options related to the booking amount?
5. As airlines support payment methods that customers value and prefer, they must also assess multi-currency pricing and dynamic currency conversion-related points. Examples – “How much to pay in my chosen currency?” or “Am I going to be charged extra if I opt to pay via my chosen method?”
6. As highlighted by CyberSource, the challenge with fraud is that its impact is multi-faceted, resulting in implications across all areas of a merchant’s business. For example, while gearing up to support the requirements of Strong Customer Authentication or SCA for an extra layer of security, its impact on the checkout flow can’t be ignored.
7. Payment processing: The role of payment orchestration in of transaction routing, authorisation rates and the ability to roll out new payment methods quickly and seamlessly is being discussed regularly at webinars/ online conferences hosted by Ai Events. According to CellPoint Digital, payment orchestration allows airlines to unify all components of a transaction under a single control layer. For cross-border merchants like airlines, this means integrating the right mix of regional and global payment partners (PSPs, acquiring banks) to optimize acceptance rates and minimize cost. Also, an agile platform will also automate back-end processes like settlement and reconciliation and incorporate fraud rules and regulatory compliance, all of which reduce chargebacks and fraud.
8. Data: Travel merchants can also be creative with their payment and fraud data to help other business functions. A case in point: fraud data can help in deriving better results from marketing campaigns. For instance, how a company realized that TikTok was resulting in account fraud and as a result fraudsters were exploited a promotion for free Amazon gift cards!
9. NDC brings a new flow to the industry and one critical aspect is related to being the Merchant of Record. So how the responsibility related to a transaction coming up from an indirect channel is going to shape up for an airline must be delved into.
10. B2B payments, tech and distribution: In an Ai Event, the importance of removing payments from distribution was highlighted.