Business Travellers Anticipating Mobile As The Future Of Travel Payments

Author: PASA

Business travellers in the Asia Pacific are using mobile payments more than the rest of the globe, however travel managers are still relying on traditional payment methods, the 2017 International Management Study (ITMS) released by AirPlus International has revealed.


AirPlus International has published the second part of the study which reveals that almost half of business travellers worldwide have already made mobile payments (44 per cent), with business travellers in the Asia Pacific region even further ahead with 62 per cent of all business travellers using this technology. In China, 91 per cent already make payments through mobile devices*.

Despite the rise in popularity for using mobile as a payment option when travelling for business, international travel managers still prefer plastic as the choice of payment during a business trip. Corporate credit cards are the firm favourites worldwide (52%), followed by personal credit cards (45%), just ahead of cash (42%).

In Australia this gap is even bigger with a huge 90 per cent of travel managers indicating corporate credit cards are used to pay for corporate travel, while for business travellers there is more of a diverse preference as 56 per cent would prefer to use corporate cards, followed closely by cash (45%), personal cards (42%) and virtual cards (21%).


The good news is that both Travel Managers and business travellers in Australia agree that mobile payments will be important in the future. When asked if they would consider offers from new players such as Apple, Google and Paypal, the majority in both groups in Australia (70% for Travel Managers and 71% for business travellers) said they would be open to using new payment technology for business travel in the future.


David Newington, Country Manager – Australia for AirPlus International explained to PASA how the latest ITMS research results impact on the procurement and supply industry in Australia:
“We believe the high adoption of mobile for payment by retail customers will cross over to corporate use. Its rise in Asia promotes the development of various point of sale technology including Near Field Communication (NFC) – popular in Australia and New Zealand and QR code scanning- popular in China.
“Our ITMS Part 2 results reveal over 70% of business traveller managers and travellers agree that they would be open to using digital methods of payment. This is a huge opportunity for the digital payments space to grow from the current 90% physical credit card usage.


“We know that digital payment enables capture and transmission of rich data. This data provides revenue opportunities through internal efficiencies such as accounts payable for the payer and inventory management for the seller, and external efficiencies such as merchandising and the aggregation of services, i.e. payment and expense management.


“Although the government-regulated reduction in interchange to a cap of 80bps (basis points) drives down revenue for issuers, at the same time it encourages acceptance by merchants even for large ticket items.


“We predict combining the data benefits and security of digital payment with the dramatic reduction in cost to the merchant will drive the swift adoption of digital payment in procurement. The lower revenue of interchange is only a barrier to the very large issuers with high legacy cost bases supporting large physical card programs.


“AirPlus International receives many requests from customers to use our A.I.D.A. single use digital payment capability for procurement payment and we support this with integration to their internal procurement, accounts payable and finance systems and processes.”


*Case study: China is the world’s early adopter
The days of China trailing the rest of the world when it comes to payment and travel technology are gone. Today, the situation has reversed. China has leapfrogged the Western model of online booking and corporate credit cards and gone straight to mobile booking and mobile payments. In the country’s largest cities it is becoming increasingly common for citizens to go out without a purse or wallet and take only a mobile device instead, paying using products like WeChat and Alipay.


Chinese business travellers are leading the world in the ITMS results:

➢      Only 2 per cent say they would not consider using new payment providers, the joint-lowest figure for any country

➢      91 per cent already make payments by mobile devices, the highest figure worldwide and way ahead of the global average of 44 per cent

➢      60 per cent make mobile payments for both personal and business expenses, the highest figure worldwide