By Now Pay Later payments in travel and aviation are expected to continue taking market share despite the threat of greater regulation.<\/p>\n
Speaking at the UATP Airline Distribution conference held in Budapest, providers of the instalment-based payment category agreed that it has seen \u201camazing\u201d growth in recent years.<\/p>\n
The fast-emerging payment option has weathered the impact of high rates of inflation and interest in a \u201ccomplex economic environment\u201d, said Vicent Moirez, head of strategic partnerships at FLOA.<\/p>\n
This has put pressure on consumer \u201cpurchasing power\u201d, but BNPL has been growing at an annual rate of 20% over the last five years despite the impact on an \u201calready low margin\u201d payment type.<\/p>\n
New European regulations, that will bring BNPL under tighter consumer credit laws, are due to come into force in November.<\/p>\n
Moirez warned: \u201cThe risk is to burden the UX [User Experience] which is the DNA of BNPL. We have to be very cautious on the regulation and the impact on UX.\u201d<\/p>\n
Matthew Maurer, director of strategy and business development at Upgrade\/Flex Pay, described BNPL as tool in the toolbelt for airlines\u2019 merchandising strategy.<\/p>\n
\u201cWhen a customer searches they see a lower monthly price rather than the full price. You can use BNPL to drive certain desired behaviour.<\/p>\n
\u201cIf an airline is trying to sell more business class seats during a period of lower demand they can offer a BNPL fare promotion for customers to upgrade from economy.\u201d<\/p>\n
Moirez said he believed there was still room for BNPL to grow in Europe. It currently average 8% market share although in some countries, like Germany, it is up to around 20%.<\/p>\n
\u201cWe still have huge room for improvement in some countries,\u201d he said, pointing out that 40% of the BNPL market is younger Gen Z customers.<\/p>\n
\u201cAS we all grow older Gen Z by 2023 will take a dominant position in the working population and their spend will grow very strongly by 2030.<\/p>\n
\u201cDespite the complex political situation, there are reasons to be optimistic for the market.\u201d<\/p>\n
FLOA and Flex Pay have agreed a strategic partnership to help each other\u2019s customers break into the European and north American markets respectively.<\/p>\n
The firms are targeting global airline partners in a deal likened by Maurer to a code share between airlines.<\/p>\n
He said clients will get the best of both worlds in North America and Western Europe including centralised account management and a single point of contact.<\/p>\n
\u201cGiven we are both on the UATP network it makes is super safe and seamless to build out the technology integration between us the FLOA API and airlines. It\u2019s a win win win across the board.\u201d<\/p>\n
Moirez added: \u201cFor us it was obvious to move forward on an agreement. We have already had the first strong interest from a big international airline.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
By Now Pay Later payments in travel and aviation are expected to continue taking market share despite the threat of greater regulation.<\/p>\n","protected":false},"author":120,"featured_media":183404,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37,1131,35,39,4041],"tags":[],"class_list":["post-183403","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-airlines-airports","category-industry-news","category-low-cost","category-technology","category-tech-digitisation"],"yoast_head":"\n