B2B foreign exchange payments by travel companies increased by more than 480%, year-on-year, in the first half of 2022, new research shows.
The research – from leading B2B travel payments specialist Nium – is a good barometer of just how much international travel has recovered since most countries removed their Covid restrictions.
However, it also highlights the return of a familiar headache for travel companies as international travel requires foreign exchange B2B travel payments between travel intermediaries and airlines and hotels. Because, with the rise in payments comes higher costs, payment delays and risks.
“Over two years have passed since many travel companies last saw a peak booking period in international travel and naturally many have been distracted by other more important things since then: namely surviving,” said Spencer Hanlon, head of travel at Nium.
“So, understandably many have probably forgotten about the headache that B2B foreign exchange payments can bring them: high costs, delays, time consumed and risks. Clearly, this is a high-class problem to have back on the agenda, but it is one that, nonetheless, is costing the great majority of travel businesses dearly. In fact, I’d go as far as to say that some companies quite possibly didn’t fully factor this cost into their pricing when forecasting and preparing for the recovery,” Mr Hanlon said.
However, Mr Hanlon said there are many modern technology solutions that can resolve this problem to massively reduce the transaction fee, gain access to fairer rates, speed up the payment, and both satisfy and streamline all the back-office needs a business might have.
“And, it really doesn’t require much time or effort to resolve once the right solutions are found,” he said.
“At a time when inflation is raging, interest rates are rising and many no doubt have debts from COVID, solving your FX problems could make a significant difference to the health of your business,” Mr Hanlon said.
