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The rapid, digital evolution of payment methods is one that travel companies need to watch. Find out the latest payment trends and how they can help inform your business strategies and stay ahead of the competition.
The travel industry is steadily recuperating from the pandemic, but the last few rocky years have caused seismic shifts in consumer expectations when booking trips online. These newfound expectations have, and will continue to have, a consequential impact on the travel retail landscape.
70% of travellers would choose one travel provider over another if they received a positive payment experience.1
The payments space is one travel companies need to watch. The rapid, digital evolution of payment methods and their uptake by savvy consumers over the past two years have turned buzzwords like ‘seamless’, ‘contactless’, and ‘mobile-optimised’ into musts. Travel retailers hoping to regain their market share can turn to these payment trends to inform their business strategies and stay ahead of the competition.
Buy now, pay later (BNPL) has been hailed as a huge disruptor in the online payments space2, and this growth shows no signs of slowing. Experts forecast that the BNPL industry will experience a compound annual growth rate (CAGR) of 30.8% until 2028, as the deferred payment method’s popularity continues to gain traction with younger consumers.3 BNPL’s popularity in Europe is the highest among UK consumers too.3
57% of UK consumers are more likely to make a purchase at a retailer offering interest-free payments options.4
BNPL’s uptick has been significant in the travel retail space since 2021, with more airlines and booking platforms partnering with deferred payment providers to offer this service.5
PayPal’s Pay Later solutions are at the forefront of deferred payment offerings in Europe. PayPal Pay Later users are 1.4x more likely to use BNPL on a frequent basis than consumers who use other BNPL products. As consumers turn to BNPL to finance their holidays, flexible financing options are essential to future-proofing your commerce strategy.
QR code payments have become the norm across Asia, but the concept is still growing in Europe. QR codes have, however, become ubiquitous across the continent as a safety measure since 2020. This exposure has inspired some European retailers to pivot to QR codes as a contactless payment method. They are fast, frictionless, and relatively low-cost for retailers to implement.
67% of Europeans agreed upon the fact that QR codes made life easier.6
In the travel space, QR code payments enable consumers, whether foreign or local, to pay with ease, no matter the point of sale. Gone are the days of having to fuss with exchanging foreign currency.
Currently, over 190,000 businesses in Europe offer QR code payments7, used by both locals and tourists. QR code payments are also making their way into airports. In May 2021, Munich Airport became the first in Europe to introduce PayPal QR code payments, allowing PayPal users to enjoy touch-free transactions on their smartphones.8
QR code payments are also primed to become a mainstream feature across travel booking and airline websites in the years to come.
Consumers today demand frictionless payments no matter where, when, and how they shop. They expect their e-commerce journeys to be fast, secure, and easy to navigate. Any encounters with friction, especially during payments, could lead to a missed conversion.
The travel industry suffers from some of the highest abandonment rates in e-commerce9, so incorporating a frictionless, end-to-end payments solution is crucial for travel operations to improve sales and overall customer satisfaction.
Checkout optimisation can increase conversions by 35.62%.10
PayPal’s position as a global, leading payments platform helps organisations orchestrate payment ecosystems from pay-ins to pay-outs, services and support, giving you every opportunity to grow your business while keeping up with the ever-changing commerce landscape. PayPal is a gateway to fast, more flexible, and secure transactions in multiple currencies—an ideal fit for operators in the travel and bookings space.
With PayPal, 34% more checkouts are completed11, and businesses enjoy 17% more repeat buyers.12 In a hyper-competitive space like travel, onboarding PayPal as your payments partner can make a notable difference. Find out how at https://www.paypal.com/uk/travel-industry.
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