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Need for more efficient payments driving global uptake of virtual cards

May 15, 2014 Financial No Comments Email Email

Agencies looking for more efficient supplier payment methods are driving the global uptake of virtual cards, as eNett International launches Virtual Account Numbers (VANs) to Australian agents following phenomenal growth in Europe.

A VAN is an automatically generated 16-digit MasterCard number for each booking transaction, making reconciliation simple for everybody in the value chain.

http://www.keysurvey.com/votingmodule/s180/survey/406424/1152/eNett – a joint venture between Travelport and PSP International – is including its innovative virtual payment technology to its suite of payment solution offerings for Australian agencies. While larger agencies have traditionally been the first to access such solutions, this Australian launch makes VANs available to all small and medium-sized agencies.

Current trends show that agencies are increasingly dealing directly with suppliers and accessing dynamic content that require immediate payments, accelerating the uptake of virtual card payments to secure their bookings.

PhoCusWright’s Payments Unsettled Report 2013 found that while the use of cash and traditional credit cards dominate, two out of five agencies already use or plan to use virtual card payments in the future. More than half cited reduced risk of fraud and supplier default as the major reason for moving to virtual card payments, while one third wanted automated GDS integration.

The report also found that payment at the time of booking is rising in both the airline and hotel sectors, at 30% in Asia for airlines and 74% for hotels. And direct relationships between agents and suppliers are increasing, at 40% for airlines and more than 50% for hotels.

eNett Managing Director and CEO, Anthony Hynes, said VANs are driven by the emerging needs of agencies who are looking for more content and the best ways to access them.

“We are already witnessing a significant shift in direct agency-supplier relationships with low cost carriers moving to the GDS to expand distribution, and hotels moving to dynamic and net-commission rate content. If an agency only makes supplier payments by cash, cheque or debit, they might not be able to access a range of content that gives their customers the best rates. Or, if they pay by corporate cards or store cards, they might incur significant reconciliation issues, together with opaque foreign exchange and international transaction fees.

“VANs allow an agency to make immediate domestic and international payments, with the security of the MasterCard guarantee that protects them from fraud and supplier default. Besides protecting the agency, the ability to protect the end-user is an additional customer service benefit to differentiate your agency from others. And this comes at no extra cost of using VANs, unlike other protection methods such as insurance,” said Mr Hynes.

VAN payments are available in 27 currencies, 15 of which can be settled locally, including AUD. Our partners provide transparent and competitive foreign exchange rates in real-time, providing price certainty at the time of booking.

As an added benefit for using eNett VANS, agencies have an opportunity to receive a rebate for using eNett VANs.

Agents can find out more about these trends and eNett VANs at www.enett.com/vans where they can also register for events in Brisbane (24 June), Sydney (25 June) and Melbourne (26 June).

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