Payments continue to be a major cost driver in the travel industry. According to Phocuswright’s latest research report on the topic The State of Global Travel Payments 2024, credit card fees consistently average between 2-3.9% across geographies (see Figure 1).
Forty percent of North American respondents and 32% of European respondents pay between 3-3.9% in credit card fees per transaction. Globally, 4-5 in 10 respondents strongly agreed that card processing fees are too high (see Figure 2).
On the high end, three quarters of respondents in APAC express agreement to some degree, compared to 62% in MEA, on the lower end of the scale. It is worth noting that in some countries like Australia, local law dictates that credit card processing fees must be paid by the customer.
Alternative forms of payment are a lower cost alternative to traditional forms of payment. This is especially true in emerging regions like APAC, Latin America (LATAM) and MEA. But the industry’s low adoption of AFP illustrates a gap between opportunities to reduce costs and how the industry struggles with this change due to legacy systems and processes.
This introduction is just the tip of the iceberg. Phocuswright’s report The State of Global Travel Payments 2024 dives deep into the following topics, giving travel executives an unprecedented analysis of the entire payment ecosystem in travel:
- Impact of AI on payments
- Key takeaways
- Costs of payment
- Fraud
- Settlement cycles
- Shifts in distribution
- B2B developments
- Virtual credit cards
- Corporate travel payments
- Technology provider perspective
- Trends in global payments
- Real time payments
- Open banking
- BNPL
- Embedded payments
- Digital currencies and CBDCs
- Mobile wallets and superapps
- Cross-border payments
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