Take control of travel industry payment and optimize profitability
With the transition to Modern Airline Retailing, payment has become more than a simple tool to conclude the sale. It is now a strategic value-creation lever, essential to an optimal customer experience throughout an often omnichannel journey of multiple Offers and Orders. And there is potentially $40 billion in revenue to be made. Yet airline payment costs – including external acceptance fees, internal costs, fraud losses, and cash flow costs – represent over 2% of airline revenues, on a par with the average airline margin.
To optimize profitability, by maximizing potential revenue and minimizing costs, therefore depends on taking control of payment. And that requires adopting a unified payment approach, based on a clear strategy.
Align your airline payment strategy with your commercial objectives
Pursuing its foundational role facilitating how airlines do business, IATA has launched, and continues to develop, a unified payment portfolio to support airlines in their efforts to control payment.
How to deploy an omnichannel payment strategy
Meeting customer expectations for preferred forms of payment in multiple markets and across multiple channels, increases payment complexity and cost. A payment orchestration platform allows easy connection to market-specific, cost-efficient, more secure forms of payment; smart routing; and payment performance to be monitored and optimized, with end-to-end visibility and control across payment flows.
How to better control payments by travel agents
To better manage payment risk, high payment costs and overall efficiency in the indirect sales channel, airlines need greater visibility and control over how travel agents pay. With tools to easily monitor, control and secure travel agent payments, carriers can enable increased revenue, while keeping costs and risk down. IATA offers two proven solutions to facilitate management of indirect channel payments.
How to reduce passenger cost of payment
Instant payments – bank account to bank account, in real time – are becoming increasingly popular worldwide, and are mandatory in some jurisdictions. Direct payment solutions are now expected by consumers, especially younger cohorts, as they offer speed, low friction, and greater budgetary control, as well as low or no fees compared to other FoPs. IATA enables easy deployment for direct online sales to passengers.
Explore a unified payment approach with IATA's payment experts
Tell us about your commercial objectives and your payment strategy, and let our payment experts guide you through our portfolio of products and services to identify and refine the solutions that work for your organization
IATA Financial Gateway (IFG) – an air-transport dedicated omnichannel platform for payment and settlement orchestration and management
| Ochestrate your payment strategy | Enhance revenue potential | Reduce the cost of payment |
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Already an IFG customer?
Did you know IATA’s payment experts can help you better manage payment-related cost, complexity, and security?
Transparency in Payments (TIP) – an industry payment-visibility framework
| Define a framework for agent payments | Detect, analyze and address high-cost forms of payment |
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IATA EASY PAY – a pay-as-you-go e-wallet solution for IATA-accredited travel agents
| Reduce transaction costs and risk | Enhance revenue potential | Control acceptance |
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Already got payments by travel agents under control?
Have you considered a concerted approach to payments, to enable customers to pay easily whatever the sales channel, while minimizing your costs?
IATA Pay – an instant payment solution for direct online sales to passengers
| Reduce transaction costs and risk | Enhance revenue potential |
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Already actively reducing B2C cost of payment?
Did you know IATA's payment experts can help you optimize costs across all distribution channels, while enhancing revenue potential?
Frequently asked questions
How does Modern Airline Retailing (NDC and Offers & Orders) change payment requirements?
Modern Airline Retailing shifts airlines from selling static products to delivering dynamic, personalized offers across all their channels. This means that payment can no longer be looked at as a tool or back office function, but as a strategic requirement.
Airlines now must support a wider range of customer-preferred forms of payment in each market, manage payment across direct, indirect, GDS and NDC channels, and maintain end-to-end visibility and control regardless of where the sale originates.
Airlines that fail to align their payment strategy with their retailing transformation risk increased costs, higher fraud exposure, and lost revenue from failed or abandoned transactions.
A unified, omnichannel payment approach, with clear policies, smart routing, and consistent fraud controls, is essential to enable Modern Airline Retailing successfully.
How can airlines reduce the cost of payment without compromising the passenger experience?
By expanding the range of accepted forms of payment, airlines give an evolving customer base options that suit them and that are more cost-efficient to process. Instant payment solutions that use direct bank-to-bank transfers – such as IATA Pay – can reduce transaction fees by up to 99% compared to credit cards, while meeting growing passenger demand for fast, low-friction payment options, especially among younger travelers. Offering local and preferred payment methods in each market also improves conversion and customer retention. A unified payment strategy, supported by smart routing and a payment orchestration platform, allows airlines to expand FoP choice while directing traffic toward lower-cost instruments.
What is airline payment orchestration and why does it matter for profitability?
Payment orchestration is the centralized management of payment flows across all sales channels — direct, indirect, NDC, and GDS — through a single platform. Payment is a lever on both sides of the profitability equation, enabling both greater cost control and revenue potential. On the cost side, airline payment costs amount to over $22 billion annually, and approximately 80% of this is payment fees, mainly linked to credit cards (Edgar Dunn). On the revenue side, if passengers can pay easily and conveniently at each of the multiple touchpoints throughout their journey, the shift to Modern Airline Retailing could unlock up to $40 billion in retail revenue by 2030, with an additional $14 billion directly related to payment strategy (McKinsey). A payment orchestration platform such as the IATA Financial Gateway (IFG) enables both the routing of transactions through the most cost-efficient providers, to reduce the cost of acceptance, and the expansion of accepted payment methods, to maximize conversion and revenue potential.
