The Future of Payment in the Hotel Industry

  • the-future-of-payment

Right now we are at the beginning of an important transformation phase in online payments, and at Availpro our goal is to help hotels foresee new trends and get ready benefit from them. That’s why we will be releasing a series of blog posts about the future of payment in the hotel industry. We start today with the viewpoint of Julien Touraine, Head of Global Sales, and in the coming weeks, look out for further posts by Antoine Buhl our CTO.

I love playing «Spot the odd one out». In a group, there’s always something behaving differently to others. I find it great to help us get out of our comfort zone.

I – Did you know that the hotel industry is the only one not taking payment at the time of purchase?

In today’s world, we are used to purchasing goods online for which we pay right away. Even when you buy a pair of shoes on the web, you pay – and then you receive the goods. We don’t see anything wrong with that.

However, when it comes to online booking there’s still an industry not behaving this way. Found it? Hotels. For some reason, it is still the last industry where you can book a room and pay only when you check out. This generates many challenges for hoteliers:

  • High Cancellations

Your inventory is blocked and you’ll never see anyone. It leaves you with 2 choices. Either play with overbookings or lose rooms you will never be able to sell again.

  • Cash Flow

Cash Flow issue is the number 2 reason why start-ups file for bankruptcy. Your business can be healthy, growing, profitable, your hotel filled-up with reservations for the coming high season, but you still need to pay your bills NOW.

When you think about the average booking window being around 3 weeks, it gives room to improve your cash flow ratio if you were to take payment at the time of booking.

Fortunately, the world is changing, offering a wide range of opportunities for hotels to turn this around.

II – What opportunities from the new world?

  • Mobile

Mobile first! Mobile usage has now overtaken desktop, forcing companies to go mobile first. However, the credit card isn’t compatible with mobility. Therefore, there are plenty of projects and companies investing in mobile payment solutions. Add this to the fact people are now used to pay as they order, it offers a great opportunity for hotels to ask for money right away.

  • Fraud

Fraud to credit card is skyscraping. How can this be an opportunity for hoteliers? Well, as this is costing a lot of money, the usual way to receive a credit card payment is getting more and more drastic (PCI Compliance). This norm however allows technological companies to transfer credit card info to each other in security, and hotels will have to cope with this too. The era of taking a card over the phone, writing it on a piece of paper that’ll stay somewhere behind the counter, is over.

III – Putting this into automatic pieces

So how can you automate the process? Well it’s easy. Your channel manager is in the centre of the ecosystem. It has the intelligence to analyse the cancellation policy of a booking coming from an OTA or Booking Engine and send the information to a payment provider accordingly.

No manual action whatsoever: the card is good, the payment is taken and transferred to your PMS; card declined, a new card is requested automatically.

All providers are PCI, card information is secured. The cash-flow ratio has improved, fake bookings, high cancellations have vanished.

This is a dream? No this has a name, this is PSP connect.



julien-touraine Julien Touraine – Global Director of Sales – Availpro

Online Executive with over 15 years of experience in software & travel Industry, Julien has been working in multicultural environments with experiences abroad and within international companies. His areas of expertise include launching a new brand on a new market (Rates To Go), developing sales and businesses (Availpro, Orbitz and, developing strategic partnerships and streamlining process operations (Availpro).