- Payment & Fraud Editorials

First Published on 6^th April, 2018

Ai Editorial: In the wake of recent concerns related to data privacy or even ongoing cases pertaining to a breach, leak or attack on personal data, it is imperative for travel companies to take a stringent action, writes Ai’s Ritesh Gupta

The significance of a company-owned core data asset can’t be undermined, but this also means there is an additional onus on travel companies to look at critical areas, be it for privacy of customers, data privacy laws or even the action that needs to be taken in case there is a breach, leak or attack on personal data.

This would be a key topic of discussion at the upcoming 12th edition of Ai’s Ancillary Merchandising Conference, slated to be held next week in Edinburgh, Scotland. Considering the recent incidents such as the fiasco featuring Facebook and Cambridge Analytica or The General Data Protection Regulation or GDPR (the deadline for compliance is May 25th, 2018), travel companies have to ensure they abide by data protection rules across Europe or other parts of the world.

Getting the basics right

Here are some of the areas that need to be taken care of:

Responsibility towards travellers: Travel companies need to provide consumers with control over how their data is used. It is time travel companies find ways to request, receive and capture customer consent to the use of their personal data.

In fact, in case of the GDPR, coverage of legal bases must feature a “freely given, specific, informed and unambiguous consent by clear affirmative action”, and also a right to withdraw consent, which must be brought to their attention. In case of GDPR, there is a need for explicit and informed consent from EU residents for collecting and using their personal data.

In case of a customer data platform, as we highlighted in one of our recent articles, travel companies need to be aware of registered consent when accessing customer data (so data coming from any touchpoint and system, the related computation or processing of data is to be done in sync with consent, assess how the data is being used, what data is being used and for how long that data can be used), address data audits in a speedy, exhaustive manner (say who has been accessing data) and ensure there is consent across all touchpoints (including integration with consent registration databases). The core data asset, say a customer data platform, needs to collect, manage, and store personal data responsibly. This is where the upcoming regulation, GDPR, comes in.

(Hear from experts about GDPR at the upcoming Ancillary Merchandising Conference, to be held in Edinburgh, Scotland this year (9-11 April, 2018). For more info, click here)

Understanding the responsibility as an enterprise: Other than consent, organizations need to assess several other areas. And here also, GDPR, is an apt benchmark to assess the preparedness.

• What is the definition of personal data?

• Who all are liable, for instance, GDPR extends liability to all organizations that touch personal data.

• Understand the implications of being checklist for data controllers and data processors. What’s the checklist? For instance, as explained in the GDPR, controllers have to adhere to compliance measures to cover how data is collected, its use, the tenure for which the same is going to be retained and making sure consumers have a right to access the data held about them. As for data processors, controllers must bind them to certain contractual commitments to ensure that data is processed safely and legally.   

• Processing must be paused if objection is raised by an individual.

• What is an organization is probed/ summoned/ asked to perform a data audit for a specific customer?

• How can a customer data platform help in making the most of the available data while complying with both the contractual and technical challenges posed by GDPR?

Other recent articles on GDPR:

Ai Editorial: As trust around “personal data” wanes, hopes hinge on a stringent regulation

Ai Editorial: How is your GDPR transformation process coming along?

First Published on 3^rd July, 2018

Ai Editorial: Travel companies are digging deep, focusing on UX design and security to streamline the payment experience. For instance, payments security through tokenization isn’t new, but specialists are counting on cloud support to overcome the issue of latency, writes Ai’s Ritesh Gupta

A major concern for a digital shopper tends to be the closure of a transaction. This particular stage generally results in few anxious seconds for many. The whole promise of a simple and frictionless payment procedure can go for a toss even if a shopper, especially using a mobile device, is made to wait. This delay can hamper the experience and eventually there could be shopping abandonment.  

This is exemplified by the fact a one-second delay in mobile load times can impact mobile conversions by up to 20%, as found out by Google. The delay means it can cost travel merchants dearly since travel shopping tends to span across many sessions and is a prolonged one.  

Optimizing payments page for mobile 

Travel companies have been focusing on several areas to ensure one gets closer to transacting on mobile. Every aspect of payment-related user experience (UX) design is being handled adeptly.

Be it for designing the payment page or working out a specific interface for each device, the level of detailing has increased tremendously over the years. According to Adyen, it is imperative for travel merchants to work out a uniform experience across any device. Whether the user is paying in the native app, or via a mobile browser, the checkout phase needs to pave way for conversions on any screen size. Travel companies need to ensure they have latest information about their customers to facilitate their recurring transactions. Also, in case a user suffers owing to the Internet infrastructure being slow, then how about cutting down on the number of images downloaded. All these adjustments can go a long way in soothing the concerns of the shoppers. Plus, companies like Adyen are trying to be proactive by working out options to deliver user-related reporting (i.e. providing shopper-level information including shopper ID, card token, etc.). With these details, merchants may be able to precisely predict what a user’s next buy will be, and when and how the purchase will be made.

As for making the payment, a consumer today has the right to not even come across payment options (after they share their information once and transaction goes through with the primary card on file).

Also, optimizing for local payment methods is another important consideration. For airlines focusing on the Asia Pacific region, one needs to diligently prepare for diversity in payments. Working on such initiatives features many aspects that go beyond finalizing payment methods, and these include setting up processes and controls (currency management, currency heading, fraud prevention, and reconciliation and reporting), and compliance (PCIDSS, sensitive data protection, costs and reliability).

Security through tokenization 

Other than UX design, the shopper needs to be assured about security.

As Adyen highlights, everything that a merchant facilitates behind the screen” (e.g. tokenization of stored payment data, 1-click flows for subsequent purchases, or even use of account updater) should be clear and transparent to the users.

Payment specialists acknowledge that security is of utmost importance; however, the technologies deployed to shield a customer’s data can results in delays at the checkout stage and affect the payment experience -- especially for transactions coming in from remote locations. A progress in this arena is being made in the form of regional cloud support, an initiative that can bridge the gap between an airline and a passenger irrespective of the location. So how such initiative would help? The fact that every second counts, payment specialists are curbing any delay in mobile load times.

For instance, Braintree chose to refine its payment platform with regional cloud support, starting with the US and in Australia in May this year.

Braintree, in a blog post, shared that this will enhance its tokenization offering, which converts sensitive cardholder information into a unique token or digital identifier. It replaces sensitive payment data that cannot be mathematically reversed, enabling merchants to run payment operations without handling raw payment data. Since a player like Braintree gathers card data directly from the shopper on the merchant’s digital asset the consumer’s privacy stays protected. Still there was a need to overcome the issue of increased latency arising in remote locations. In today’s fast paced shopping environment, microsecond latency counts. The time taken to transforming PAN (Primary Account Number) to token and back to PAN needs to be done in a swift manner, and this shouldn’t have any sort of negative impact on payment processing. With cloud support, the plan is to accelerate the checkout phase and augment the payment experience.

Importantly, the team at Braintree indicated that initial tests show that shoppers in Australia experienced an average upsurge in speed during checkout of about 2.5 seconds. The team explained that it studied the same in an infrastructure production environment – “10 times during 1 minute, the average time for requests made to the Braintree data center and the average time for requests made to its local cloud service”. Plus, this initiative combined with a new Content Delivery Network (CDN) service, which minimizes possible communication failure rates.

Hear from airlines and other industry executives about payment experience optimization at the upcoming 7th Annual Airline & Travel Payments Summit (ATPS), co-hosted with UATP, (4- 6 September 2018 in Phuket, Thailand).

For more click here

Follow Ai on Twitter: @Ai_Connects_Us

First Published on 19^th November, 2018

Ai Editorial: Data breaches/ stolen financial information, fraudulent transactions, account takeover (ATO)…merchants have to be at the top of their game to combat commerce-related fraud and at the same time ensure their buyers remain happy with their shopping experience, writes Ai’s Ritesh Gupta   

The situation is trickier than ever. Validating a payment could be about running through a gamut of data points and returning with a decision in fraction of a second to optimize a risk strategy.

Payment and fraud executives have to be crafty enough to ensure that genuine customers aren’t denied an opportunity to complete a transaction or even face hiccups with added friction. At the same time, merchants can’t afford to be a victim of fraud owing to weak authentication or fraud prevention mechanism. A specialist like Braintree underlines that simplicity is synonymous with seamlessness. So the checkout process needs to be fluent, but the experience equation isn’t complete without identifying “real” buyers and cutting down on fraudulent transactions.   

Balancing act

So what does balance denote? It’s about being proficient in validating a buyer and such verification shouldn’t interrupt the manner in which they interact and transact with a business.

Merchants need to look at new regulations, what sort of action is required and its impact on the user experience, and also the flexibility of consumes when it comes to additional measures that are being taken for authentication.

In this context, Visa in the recent past initiated new offerings.

For instance, Visa chose to help merchants in following the new European requirements for Strong Customer Authentication (SCA) that come into force in September next year. One way to differentiate between transactions is the risk associated with them. Visa is helping various stakeholders, including merchants, in spotting transactions in real-time that are at low risk and working out a quick checkout for such transactions. Visa asserts that the team ensures a buy is evaluated on a variety of factors such as location, merchant type, previous purchases, transaction size etc. If on one hand, it is closely looking at adding convenient options for any additional step that prolongs the check-out process, on the other, Visa is also capitalizing on the evolution of the consumer technology to simplify authentication. One such move is enabling banks to count on biometric authentication into their respective apps so that users can avail their connected device and use their fingerprint, their voice their face to finish a transaction. The industry is also weighing ongoing improvements, for instance, EMV 3-D Secure Specifications, for a real-time, secure, information-sharing pipeline to authenticate buyers without adding any friction in the buying process.

Other than tools, global merchants like airlines, also need to dig deeper and understand the peculiarities of each market before taking steps to streamline the buying process.

In its 2018 Global Fraud and Identity Report, Experian shared critical findings (based on 11 countries surveyed):

·          Consumer tolerance for friction for the sake of security varies with reference to various nations.

·          This is a dynamic place and merchants need to be vigilant of the changing scenario. Considering the variance in tolerance for friction, one solution is hard to finalize. Also, since it is “a moving target”, companies need to adjust especially if buyers’ tolerance for friction could lessen over time.

Being smarter 

Merchants need to understand the limitations of existing measures, and also leverage the prowess of data-driven, artificial-intelligence powered offerings for combatting fraud. Rules-based systems are in general reactive and probabilistic solutions, which is why they are unable to prevent fraud before it happens. Rather than using a blanket rule that forces every user to login with 2FA, real-time surveillance can be used to assess logins in the background, and only logins with borderline risks expected to go through 2FA.

Merchants should still develop their own fraud tools that are able to tap on their own sources of data for greater efficiency and more accurate detection of fraud. Real-time machine learning can help against blanket blacklists and whitelists by focusing on the customer’s behaviour instead. It works with real-time live data collected on the merchant’s website, where the system trains itself with each incoming transactions to identify fraud patterns instead.

Check upcoming Ai Conferences dates or

Follow Ai on Twitter: @Ai_Connects_Us

23^rd April, 2020

Travelers have been exploring options for claiming flight cancellation compensation, and are peeved at large that they aren’t getting their money back.

The going hasn’t been smooth for passengers, airlines and those involved in processing of payments owing to the coronavirus crisis. The fact that, there has been an explosion in credit card disputes, as Monica Eaton-Cardone, Chargebacks911 asserts, explains the same.

From a traveler’s perspective, there are vital tips available that can be used as a guide for how to file a credit card dispute, what to do in case a traveler booked a flight with airline miles etc. There have been numerous such cases, for instance in the U. S. and the U. K., that have been by highlighted by blogs and media.  

To the credit of the industry, the likes of Allegiant and Spirit are offering refunds to passengers who voluntarily and proactively cancel their own tickets. But that hasn’t been the case with others. In fact, it is being highlighted airlines in the U. S. are sitting on more than $10 billion in customer cash, instead of returning this significant sum of money to the American public.

In case airlines aren’t responding to a claim for refund, then don’t initiate cancellation on your own. If you do, then do consider whether the travel company is offering refunds to travelers who voluntarily and proactively cancel their own tickets during the crisis. Also, assess is your ticket refundable? How to get a refund a non-refundable airline ticket in the US (see a link below)

In case, airlines aren’t supporting those travelers who voluntarily wish to cancel, then playing the waiting game is the best option. So wait for an email, check the website etc. and then take action. For more details, here are useful links from the U. S. and U. S.:

How to make a claim under Section 75 of the Consumer Credit Act 1974 in the U. K.?

https://www.skyscanner.net/news/what-can-i-do-if-my-airline-goes-bust

https://www.headforpoints.com/2020/04/17/use-section-75-to-get-a-flight-or-hotel-refund/

https://www.which.co.uk/news/2020/04/flight-cancelled-can-i-get-a-refund-from-my-credit-card/

How to file a credit card dispute in the U. S.? What to do for flights booked with airline miles?

https://www.washingtonpost.com/lifestyle/travel/how-to-file-a-credit-card-dispute-for-your-canceled-vacation--and-win/2020/04/08/316e7b7e-7807-11ea-b6ff-597f170df8f8_story.html

https://www.bankrate.com/finance/credit-cards/canceling-flight-coronavirus-guide-to-getting-money-back/

https://thepointsguy.com/guide/how-to-refund-nonrefundable-airline-ticket/

By Ritesh Gupta

Ai Correspondent 

3^rd Februrary, 2020

Ai Editorial: Dealing with credit card decline codes is a daunting task. Ai’s Ritesh Gupta explores how a deeper analysis of these codes and collaborative approach can help in payment authorization.

Evaluating ways to improve upon approval rates for online card payments is always high on the agenda of travel merchants.

Independently travel e-commerce players are looking at ways to seamlessly authenticate users across the omnichannel customer journey. The role of cloud-based intelligence, backed by artificialintelligence and machinelearning, is coming to the fore. Assessment of both risk pointers and positive identity indicators is the way to go. This way travel merchants can better comprehend the context of a shopper, their behavior, and their score in terms of digitalidentity trust and risk. Other than ensuring that a legitimate shopper shouldn’t suffer owing to a wrong decline of a card, travel merchants also need to be in control of processing costs as well as focus on fraud prevention. There is no secret sauce for all this in the payment landscape, but crafting an astute authorization strategy is an ongoing effort that demands continuous introspection. Working with other stakeholders holds key here.

When it comes to authorization and acquiring for more than one market or cross-border transactions, a merchant can assess options such as  working with a payment services provider, setting up a local legal entity and entering into merchant agreements with local acquiring banks etc.

Coming to grips with soft and hard declines

Technically, credit card rejection happens when a card payment cannot be processed and the transaction is declined by the payment gateway, the processor, or the bank issuing the money. A credit card decline code is a message issued in response to a request for authorization during a transaction.

It is here dealing with the travel shopper in an apt way – via a simple and transparent communication – can help.

According to Chargebacks911, the issue is credit card decline codes are not standardized; they differ from one payment gateway to the next. They also tend to be rather unclear, as this helps in shielding the cardholder’s privacy and avoid giving away sensitive information in the event of a genuine fraud attack. Details pertaining to why a payment tends to get rejected can be provided by an acquirer and this in turn can boost the conversion rate. As Ingenico points out, even though the rejection or response codes offered by acquirers may appear dauntingly technical, it’s extremely useful to understand what they mean.

Adyen recommends that  profile of each transaction needs to be considered based on its amount, if it’s recurring, local regulations, issuers' authentication preferences, your relationship to your shopper, and more.

Some declines may be the direct result of the cardholder's actions while others are the result of external factors. The most important distinction is between “hard” and “soft” declines. A hard decline happens  when the issuing bank or processor denies the processing of the transaction and retrying the card won’t help at all. Hard declines are not recoverable at the time of the transaction. Whereas soft declines are generally a temporary issue. Retrying the provided payment method information may be successful.  One way to deal with such scenario is to automatically route selected failed transactions to a secondary acquirer for a “retry”. This can increase authorization with virtually no impact on the customer experience, asserts Ingenico. Essentially merchants need to constantly explore ways to salvage such situations.  A partner should be adept at analysis of past declines, transparent data, ongoing analysis of global transaction types etc. Also, developments like PSD2 are all about more carefully processing and managing data, including payment transactions.

PSD2 SCA 2020 - how to go about it as a travel merchant?

Not just merchants

And it’s not just merchants, but even other stakeholders, including card schemes and issuers, too, are focusing on sorting some common issues that tend to block transactions that simply should not have failed in the first place.

Traditional companies are stepping up their efforts  in the wake of increasing competition from alternative form of payments plus new developments that are fueling emergence of fintech digital payment specialists. For instance, it is being acknowledged that as a vital link in the payment chain issuers need to share relevant details regarding why the transaction has been declined. Many tend to supply response codes that are ambiguous and tough to comprehend. And in certain cases such codes cannot be interpreted at all. Effective fraud prevention and detection requires real-time collaboration and data sharing. In fact, with a collaborative approach where data on fraudulent and suspicious transactions is shared (and keeping it anonymous, too, where required), details are out on new fraud attempts no matter where they first appear.  But all of this demands a diligent effort. For instance, considering the case of passing SCA or Strong Customer Authentication  messages through complex transaction flow in the travel e-commerce sector.  

It is imperative for merchants to work collectively internally (fraud and risk management, customer service, operations, technology and product management teams) to optimize authorization and fraud strategies, and work with various external stakeholders as well for the same.

Keen on exploring fraud prevention and payment-related issues?

Check-out Ai’s conferences scheduled for 2020: https://lnkd.in/fE7UK_T

21^st September, 2020

What has lacked in the airline industry so far has been an innovative and cooperative approach to manage the refund process during this pandemic, according to Tobias Wessels, Founder at Rebound Travel

The coronavirus outbreak created havoc in the travel industry. Travellers understandably opted for refunds and also chose to reverse a transaction, not agreeing with a charge on their respective cards. Airlines have been and in the future, too, are going to be judged on the basis of the way they handle refunds. 

“COVID-19 put all airlines under a severe stress test and accommodating so many customers for cancelled flights is not something that airlines could have envisioned prior to the pandemic,” acknowledged Tobias Wessels, Founder at Rebound Travel.

“Airlines offered to rebook customers which created a worldwide backlash, enormous frustration and lost in trust with airlines. The US DOT and the European Commission then stipulated that airlines have to pay their customers in cash for cancelled flights. While it is the right thing to do, those cash payments put even more stress on the already cash-strapped airlines. In the US more than $20b have to be paid back to customers in cash but the problem also exists in Europe. Lufthansa reported that they had to pay back more than EUR 2.5b to their customers. What has lacked in the industry so far has been an innovative and cooperative approach to manage the refund process during this pandemic,” Wessels told Ai’s Ritesh Gupta in an interview.

To salvage the situation and work on a prudent offering, Rebound Travel has initiated a refund management platform.

Through Rebound, airlines give customers that choice: customers with a pending refund can freely choose between their cash refund and attractive non-cash offers like vouchers, miles, BOGO offers, upgrades or shopping credit. “To motivate customers to choose an alternative to their refund, airlines offer a more attractive offer which could be a USD 2,400 travel voucher for a USD 2,000 refund. In some situations it is less important to offer "more" but the right options: a frequent flier that is 6,000 status-miles away from his or her next status sees more value in reaching the next status-tier immediately versus a flight voucher,” said Wessels.

“Rebound provides the intelligence so that airlines offer the optimal offer type and value that motivates customers to choose an alternative offer to their refund while keeping the airline's opportunity cost as low as possible. We will announce our first partnerships here in the US and internationally very shortly,” shared Wessels.

He shared that the team consists of former airline executives. “It was important to us to offer a suite of solutions where everyone benefits including the traveller on a long-term basis.”

Transparency and Honesty

Several airlines changed their stance to adopt customer-friendly policies, whereas certain carriers didn’t and rather chose to only offer travel vouchers.

“It is great to see that the airlines are becoming more customer- focused in this crisis. Our approach at Rebound has been to involve the customers in the process and create value for airlines and travelers at the same time. Be fully transparent and honest in your process. Your customers understand that you are overwhelmed with the operational burden to process refunds. To encourage people to travel more it is important to regain trust and make it as easy and attractive as possible to fly again. Giving travellers a choice is a good first step, recommended Wessels.

“With Rebound, the airlines retain their cash and ensure that their customers return to them for future travel. That is especially important as your frequent flyers and front-of-the-cabin passengers account for the majority of an airline's profit. We also expanded our platform based on our partners' feedback to not only help during refund cases s but to retain cash in all situation when there is an expected cash-outflow like denied boarding,” he said.

Acknowledging that chargebacks are a long-term industry concern and have been very difficult, expensive and time-consuming to reduce for airlines, he said Rebound provides airlines a unique identifier of customers that choose the refund or one of the non-cash offers. That identifier is then used by airlines and presented to the credit card companies in what is called "representment". With the Rebound ID that validates the original credit card transaction of the customer, the airline significantly reduces or wipes-out the chargeback risk altogether.

As for the response, he said the industry feedback from partners in the US or organizations like IATA has been much better than expected. “We plan to announce our first partnerships very shortly and aim to help any airline to retain cash and strengthen loyalty with their customers. Other adjacent industries like cruises and attractions have shown interest in Rebound as well,” concluded Wessels.

Pitching Contest of Disruptors for the New Normal - Ai Events Virtual Lions Den

Join the Rebound executive team and other attendees from the industry on September 23rd 2020 as part of the session, “Disruptors for the New Normal”:

http://www.airlineinformation.org/upcoming-events2/488-ai-events-virtual-lions-den.html

First Published on 4^th December, 2018

Imagine receiving an email early in the morning, stating that your personal data has “possibly” been compromised. It’s disturbing. But the agony doesn’t end here. Ai’s Ritesh Gupta explains why.  

A data breach is a big concern for all. From consumers’ perspective, if one understand the tricky situation it can shake one and all. Come to think of it - if a user has created a formidable password and believes everything is fine, how about unearthing the fact that if there is a data breach, then the same password is leaked and is of no use. Considering what all is at stake, the leaking of passwords and how a fraudster can benefit from it is an annoying as well as distressing situation for the user.  

As experienced from an email from Quora today, the company shared that some user data was “compromised by a third party who gained unauthorized access” to its systems. Information that may or may not have been compromised includes account and user information (e.g. name, email, IP, user ID, encrypted password, user account settings, personalization data). Even though the company acknowledged that it is their responsibility to make sure things like this don’t happen, it also stated: “while the passwords were encrypted (hashed with a salt that varies for each user), it is generally a best practice not to reuse the same password across multiple services, and we recommend that people change their passwords if they are doing so”.

A massive problem for consumers

The agony prolongs after this email. The thought of using one password for multiple accounts haunts. 

A frail approach towards password management is enabling hackers to gain access to confidential information.

As per an analysis, initiated by password management specialist LogMeIn’s LastPass, nothing much has changed over the last two years when it comes to choosing and handling of passwords.

As we highlighted in one of our reports, consumers stick to same passwords and don’t change them often. This is a significant revelation as password stealing means all account-based online services are under a threat.

In an interview, an executive from Sift Science even pointed out that every one’s credentials have already been compromised and the industry has actually reached the point of no return. It might not be a straightforward task to gain access to everyone’s account, but just like solving a puzzle or putting several pieces together, fraudsters can sneak through the defence. So from one data beach one can get a vital piece of information about users. And then another breach sharing more details about users and so eventually cracking all details of one account.

This issue of same password for multiple accounts is a tough habit to break. Even the millennials, a group supposedly well-versed with technology, mostly reuse passwords because of fear of forgetting and commonly use a variation of 1-2 passwords they can remember! On the positive side, more users are opting for more secure password storage and automated password resets to overcome the anxiety of failing to recall, but it is a long way to go.

How to go about it?

Even as credentials are being stolen, it is imperative for organizations to bolster the authentication process. Merchants should aim to mitigate the damage done by ensuring that the stolen data cannot be used. One way to achieve this is to deploy real-time active surveillance on every login to filter out potential threats and prevent attackers from gaining unauthorized access to accounts. Organizations can avail offerings that can spot passwords that are currently in use in a domain but have been exposed in a previous data breach. As much as merchants need to take action and ensure that data doesn’t get stolen (How to prevent “Starwood guest database breach” -like incidents?), consumers, too, need to be informed.

So inform and educate customers about the significance of passwords. There might not be anything new in these instructions but nevertheless the importance of strong passwords and changing them from time to time can help. For instance, working out unique passwords that include a sequence of upper and lowercase letters, numbers and special characters. Directing users not re-use same passwords. Train the user to be security-minded and to spot scams. Also, as in case of certain apps, the password expires after a while and users are left with no option but to change it. No one likes friction in any user session, but at the end of the day the problem is too big to ignore.

Follow Ai on Twitter: @Ai_Connects_Us

1st October, 2020

Travel merchants are looking at rolling out new payment methods quickly and seamlessly as they assess ways to support immediate recovery.

Increasing the number of payment methods emerged as the top priority (43%), as indicated by the audience during a poll conducted during the #ATPS Pre-event Workshop on Alternative Forms of Payment, featuring executives from UATP, Trustly and Fly Now Pay Later. Other priorities were as follows - modernizing payment systems (30%) and to accept payments internationally (22%).

This approach is expected to help travel companies keep pace with latest advancements in this sector, as payments will likely continue to be a very hot and competitive sector for fintech investment. Also, with more options, merchants can only improve upon the CX and step up their conversion rate. Initiatives, led by investors, in this sector have already underlined the growing importance of APIs and open data. 

As for the payment challenges at this juncture, an increase in “chargebacks/ refunds” was listed as the top issue (74%).  

Interestingly, in a poll for how travelers will pay post-Covid, installments (43%) and mobile wallets (36%) came out as the top two options. The growth in installment payments has accelerated during the pandemic. The likes of airlines, hotels, OTAs etc. are considering this form of payment to be a key tool in their recovery. In case of mobile wallets, they are also expected to gain popularity because both merchants and consumers deem touch-free mobile payment as a safer and secure option.

Opportunity to improve not only improve infrastructure but also CX

Travel merchants must look at accelerating certain initiatives post diligent evaluation considering that they are trying to match revenue generation with cost being incurred to run operations.

Simon Eve, Head of Sales, Trustly, a panelist, asserted that it is an apt period for airlines and other travel players to balance their respective payment infrastructure when it comes to mitigating risk and evaluate better handling of chargebacks with alternative payment methods such as enabling travel shoppers to make fast and secure payments directly from their online banking accounts, without going through the card networks. Expanding on the same, Loee Matousek, VP Sales, Trustly referred to ease of use and cost reduction from a shoppers’ perspective along with key aspects such as guaranteed payment and saving money on a transaction for a merchant to embrace such payment option.

The travel sector struggled with the issue of refunds and chargebacks this year, but payment technology specialists highlight that there are ways to eradicate certain painpoints. And one way is to embrace alternate payment options that can resolve the issue amicably, right from offering a relevant choice to communicating properly to streamlining the refund process.  

Acknowledging the same, Sophia Melas, Head of Germany, Fly Now Pay Late, said, “We have robust communication tools in place, dedicated to the travel industry. We facilitate communication between airlines and customers.” She added, “Our refund is as simple as the payment acceptance process.”   

These players are also working on plans to improve their product that can help in stepping up the average booking value.

Another notable aspect is their expansion plans. Trustly has already announced that it is expanding its offering to Australia and Canada, going beyond existing coverage in Europe and the US. For its part, Fly Now Pay Later raised €39 million, and is too gearing up for expansion.

All of this means airlines and other travel companies are rightly chosen to expand their payment mix and along with it placing themselves in a position to eradicate common painpoints for coming out stronger from this precarious situation.

By Ritesh Gupta

Ai Editorial Team

Join experts and explore new trends in payments and fraud at Ai’s Airline & Travel Payment Summit - #ATPS Virtual Conference 2020:

Dates:  20 - 22 Oct 2020

Link: http://www.airlineinformation.org/upcoming-events2/607-atps-virtual-conference-2020.html

23^rd October, 2020

Bringing in more revenue, cutting down on expenditure, not falling prey to fraudsters’ tactics, improving processes and keeping pace with the regulatory requirements…airlines and travel merchants' goals haven’t changed but tactics must evolve in a significant way from here on.

A thorough discussion around a number of topics at the just concluded #ATPS Virtual Conference 2020 made it clear that merchants need to respond, as they attempt to “do more with less”. Some key lessons from Day 3:

1. Simplify experience for travel shoppers:  On the final day of the three-day conference, Chris Fendley, Executive Vice President, Mastercard referred to the significance of a seamless transaction. He said the whole premise of Secure Remote Commerce or SRC is to make paying more seamless for consumers.  Rather than flooding shoppers with a myriad of different checkout scenarios and options, it is about making them do less in order ensure a smooth checkout. As Keith Wilson, Director -Strategic Merchant Relations at Discover, highlighted, SRC gives every merchant “the ability to offer the Amazon experience”.

Travel merchants are looking at rolling out new payment methods quickly and seamlessly as they assess ways to support immediate recovery. Increasing the number of payment methods emerged as the top priority (43%), as indicated by the audience during a poll conducted during #ATPS Pre-event Workshop on Alternative Forms of Payment.

2. Being open and honest: Just the way Monica Eaton-Cardone, COO, Chargebacks911 emphasised that it is imperative to maintain open and honest communication with customers regarding any delays or answering their queries, Matthew Dugger, Merchant Relations Manager Asia Pacific, Ethoca mentioned that by being in touch with customers and hearing them out, travelers too can become considerate and the interactions can result in positive stories. And this can lead to more revenue via an upgrade or ancillary sale.

Adnan Beig, Head of Airlines Strategy, Amadeus  acknowledged that the trust issue must be delved into, and flexibility is going to be imperative going forward.

3. Count on data for various metrics: Merchants must evaluate whether they are receiving any actionable analytics, making the most of their payments data. Merchants can’t afford to ignore this aspect. For instance, one must evaluate how their authorization and chargeback rates compare to the rest of the industry. The filtering options help in assessing key performance metrics such as authorization rates, chargeback rates, refund rates, ATV, rejection reasons, drop-off rates etc. From a shopper’s perspective, insights from payments data should result in tailored exp. A merchant can be so targeted that no two customer journeys need look the same.
4. 
   Being nimble with fraud prevention: Fraud prevention specialists are delving into what sort of novel buying patterns are emerging as they look to foil fraudsters’ plans for fraudulent transactions. The time of the day when transactions are being conducted is changing as consumers have been working from home. Also, more people are making e-commerce buys on behalf of others, according to Vipin Surelia, Head of Risk, India & South Asia, Visa. This is also resulting in a shift in fraud pattern, added Surelia. “Phishing scams are becoming increasingly common.” As for curbing online fraud, machine learning’s role in fraud detection can’t be undermined but it shouldn’t be forgotten that it takes time to recalibrate. A human fraud analyst can take charge and control the situation, ensuring a genuine shopper’s experience isn’t hampered.

Michael Gulliver, Global Payments Manager, Webjet mentioned that fraud can be kept under the desired level. The blend of right data and right people is going to be paramount. He also shared that credit vouchers can be accepted, although for the same the regulatory aspect in a specific market also comes into the picture. 

5. Collaboration: The role of various stakeholders was discussed in detail in the last session. It featured executives from Amadeus, including Adnan Beig, Klein Wang, Regional Head of Merchant Solutions, Asia Pacific, Amadeus, and Alessandro Monge, Payment Product Management, Amadeus. Wang mentioned that her team has been in regular touch with companies, conducting workshops and seeking feedback on an ongoing basis, with focus on automation and aiding airlines in improving the cash flow.

Monge spoke about the importance of PSD2 SCA in curbing fraud. The industry on the whole seems to be far from being fully prepared, but he said, “there is no way out, we must respect SCA (as an industry).”

By Ritesh Gupta

Ai Team

11^th April, 2020

Global health crisis and quarantine has impacted our lives in a striking manner.

A couple of aspects that need to be assessed from security and fraud prevention perspective following the change in our work routine owing to the COVID-19 pandemic:  

• Professionally people have had to get accustomed to video conferencing, #WFH etc.
• Spurt in online shoppers, more mobile app use, fluctuating cart values and velocity etc.

Working from home could increase #cybersecurity risks.

One area of concern has been #ZoomBombing. Zoom has been graceful enough to acknowledge that it did fell short when it came to privacy and security expectations. Users need to follow the guidelines and recommendations on securing Zoom. For instance, Zoom has introduced a new icon. It simplifies how hosts can quickly find and enable many of Zoom’s in-meeting security features. Additionally, the Zoom Meeting ID will no longer be displayed on the title toolbar.

In fact, the main lesson would be keep all software updated and focus on unusual passwords, use two-factor authentication everywhere etc.

 Another issue has been e-commerce fraud.

As highlighted by ACI Worldwide this week, merchants are starting to experience dramatic increases in COVID-19-related phishing activities, with stolen credentials released into the eCommerce payments chain, as well as increased friendly fraud activities. The company also shared that average fraudulent attempted purchase value increased by $36 in March, driven by electronic and retail goods; this corresponds to a fraudulent attempted transactional value increase by 13 percent.

Here are few areas to look at from security perspective:

• Rely on an organization’s tech toolbox- official devices with firewall and antivirus protection, along with security features like VPN and two-factor authentication. Engage frequently with web and mobile site security management.

• Rely on VPN for encrypting data

• Coronavirus-themed emails seeking personal information are likely to be phishing scams. If an email includes spelling, punctuation and grammar errors, it’s likely a sign of a phishing email. Delete the email.

Useful links:

Do’s and don’ts of videoconferencing security

Tips for merchants to maintain security

Ritesh Gupta

Ai Correspondent