Challenges facing modern payment stacks in travel

A new report from travel platform HTS, titled “Challenges Facing Modern Payment Stacks & How to Combat Them,” outlines key issues in travel payments, including fraud prevention, payment failure, and the importance of seamless checkout experiences. The report is the third and final installment in a series examining how payment technology can enhance supplier channels in the travel sector.

Fraud continues to impact the travel industry

The travel industry has long been a target for fraud, with airlines alone losing at least $1 billion annually due to payment fraud, according to estimates from the International Air Transport Association (IATA). Fraudulent chargebacks are a significant cost burden for travel businesses, particularly those expanding into new regions where fraud tactics vary.

HTS has reported success in mitigating fraud through its checkout solution, which was initially launched on Hopper’s consumer platform. The implementation led to a double-digit decrease in fraudulent chargebacks, translating into millions of dollars in savings. The company attributes these results to its ability to scale fraud prevention strategies across multiple regions while tailoring its approach to local fraud patterns.

Payment failures and conversion rates

Payment failures on high-value travel purchases pose a major challenge, affecting both conversion rates and customer satisfaction. The problem becomes more complex for travel brands expanding internationally, as different markets have unique payment methods and regulatory standards.

According to the report, travel brands that have integrated HTS Checkout have experienced high single-digit improvements in conversion rates. By leveraging global payment infrastructure, businesses can reduce transaction failures and streamline their checkout processes.

The importance of seamless checkout solutions

Consumer expectations for a seamless, customizable payment experience have grown alongside the shift to mobile and digital travel bookings. The HTS report emphasizes that payment optionality and security are critical for building customer loyalty and ensuring repeat transactions.

HTS highlights several key components of its payment system, including:

• Fraud prevention: AI-driven fraud detection leveraging insights from the travel industry’s largest dataset, coupled with third-party fraud vendors such as Riskified, Sift, and Forter.
• Dispute management: Automated dispute resolution for low-value chargebacks, reducing operational costs.
• Security and compliance: End-to-end security, including PCI DSS compliance, two-factor authentication, and payment validation.
• Global payment infrastructure: Support for over 100 payment options, 35+ currencies, and partnerships with more than 200 acquiring banks and payment service providers.
• Smart routing technology: Dynamic transaction routing to optimize authorization rates in domestic and international markets.

Download the full report here.

Header image credit: HTS