Early man used cowry shells as currency, past civilisations traded grain for spices, and ancient Egyptians used weighted gold bars to pay their debts. There’s no doubt about it: the nature and landscape of making payments is constantly changing and evolving. In today’s climate, there is a distinct move towards virtual, technology-based and hassle-free banking. The question is, what does this mean for the travel industry?
At the GBTA (Global Business Travel Association) workshop in Johannesburg in August, a panel of experts set out to get to the bottom of this question. The importance of this topic was highlighted by the panel itself, with representatives from Diners Club International, American Express Card, Citibank, and eNett all ready to take questions from Dion Chang, Founder of Flux Trends. With steadily growing usage of virtual payments in Europe, all panelists were clear: the move to online is imminent, and a lot of time and money is being invested in making this process as simple and safe as possible.
As Chang pointed out, however, large technological moves such as this one are seldom painless. In many African countries, card payments and card acceptance remain huge issues, and it is only through a joint effort to drive acceptance from all relevant parties that payment methods will be able to evolve.
Other challenges surrounding the move to virtual payments include reconciliation, education around these payments, and the risks of fraud. In response to this, FSPs (Financial Services Providers) are working hard to build their virtual payment solutions to tackle these pain points, and evolve with them. With non-traditional competitors such as Apple entering the game of financial service providers, there is increased pressure to not only provide the best virtual payment solutions, but to also be at the heart of the exchange of money and information. Going forward, the only way to ensure this is by engaging with customers and identifying exactly what they need resolved, and what they would like out of their virtual payment solutions.
For the travel industry in South Africa, FSPs will inevitably struggle with the growing need to integrate into existing systems that are used by their customers. While the ability to create a ‘one size fits all’ solution becomes increasingly difficult, the uptake process of virtual payment solutions can be increased greatly by educating the market and driving usage – a strategy that has contributed greatly to the success and growth of virtual payments globally.
Ultimately, the move to a completely virtual payment solution in Africa is inevitable, and the efforts being made by FSPs to guarantee safety, reliability, and a smooth immigration is extremely encouraging when viewing the future of payments. Whether this immigration will be painless and simple, however, is still to be seen.