Study Found Outdated Payment Methods Constrain Profits
October 23, 2014
SAN FRANCISCO, 23 October 2014: Outdated payment methods are costing North American travel agents tens of thousands of dollars, according to figures quoted today by eNett International, at the Travelport Connect seminar in Vancouver.
Agents attending a session conducted by eNett International, a leading provider of dedicated B2B travel payment solutions, learned that manual processing which accompanies conventional payment methods is draining away money that could otherwise flow through to their bottom lines.
Based on PhoCusWright research findings, US$1.5 billion each year is wasted on manual processing and reconciliation1. Small travel agencies turning over less than US$25 million typically needs one to three part-time staff members to manage and reconcile payments manually, incurring estimated costs of US$33,000 a year. This spirals to around US$325,000 for large agencies transacting US$100 million or more2.
eNett Virtual Account Numbers (VANs) address the problem by allowing agencies of all sizes to easily adopt an innovative and integrated supplier payment method that creates cost savings.
A VAN is a unique 16-digit MasterCard number generated for each booking and can include payment parameters such as amount, currency, date and merchant, making it a highly secure way to pay or be paid.
VANs also enable agents to work more efficiently, through integration with booking and back-end office tools, while also automating reconciliation in real time.
eNett’s recent partnership with Cornerstone Information systems, part of its expanding footprint in North America, has generated a key example of the efficiencies that can be achieved.
The two companies have combined to provide a direct hotel billing payment solution for Travel Management Companies (TMCs) to cut the inordinate amount of time spent on manual calling and faxing, freeing them up to take on more clients and increase profits.
eNett Managing Director and CEO, Anthony Hynes, said, VANs surpass legacy payment processes that are hindering the desire for agencies to reduce costs and increase profit margins.
In Europe and Asia Pacific, we have already seen the phenomenal uptake of eNett VANs driven by the universal need for agencies to curtail increasing manual processing costs and the downward pressure on profit margins.
As we extend the solution to North America, our unique cash collateralized model facilitates easy access to cutting edge payments technology without the need for lengthy credit assessments, allowing agencies to be up and running within days.
VANs are fully integrated within the Travelport Travel Commerce Platform which significantly reduces handling times and eliminates the need to cut and paste between systems. With each VAN generated for payment, a payment entry is made instantaneously, recording it for automated and seamless reconciliation.
Agencies can choose from several low-cost FX options available across 27 currencies, 15 with local settlement. In addition, eNett customers can earn rebates for transactions paid with VANs as soon as they start transacting3.
1. eNett analysis of PhoCusWright Payments Unsettled Report 2013 and IATA reports
2. eNett analysis of PhoCusWright Payments Unsettled Report 2013
3. Terms and Conditions apply.
About eNett International
eNett International is a global provider of payment solutions uniquely tailored to the travel industry. Its core offering is a Virtual Account Number (VAN) payment solution that automatically generates single-use MasterCard numbers to facilitate payments across the MasterCard processing network, enabling acceptance at more than 35.9 million locations worldwide.
By using eNett VANs to make supplier payments, travel buyers and travel providers alike, are able to reduce their risk, improve reconciliation and generate financial, data and efficiency rewards. eNett is majority owned by Travelport which is traded on the New York Stock Exchange under the symbol TVPTî and its capabilities are integrated into the Travelport Travel Commerce Platform which operates in over 170 countries today. Its other shareholder, PSP International, provides banking services to the enterprise.