Solutions for travel

WE UNDERSTAND

  • Payments providers avoid risk by demanding your collateral or holding back payments in rolling reserves, or both!
  • You are running a low margin business in a competitive industry.
  • Collateral is a huge cost of capital and delivers no return.
  • Bad payment terms means you don’t get the cashflow you expect when you expect it.

WE UNDERSTAND

  • Payments providers avoid risk by demanding your collateral or holding back payments in rolling reserves, or both!
  • You are running a low margin business in a competitive industry.
  • Collateral is a huge cost of capital and delivers no return.
  • Bad payment terms means you don’t get the cashflow you expect when you expect it.

WINTER HOLIDAY COMPANY

  • One of our customers, with an annual volume of €40m, had €2m in collateral and 10% rolling reserves with their old payments provider. This was reduced to zero using Trstpays and one of our payment partners.
  • Our panel of payments providers are experts in the travel sector, and together we can put your travel business back in control of your payment strategy.

TRAVEL: A RISKY BUSINESS?

  • Since holidays are often booked well in advance, payments providers consider the industry as high risk, and as a result the offering to the travel business is less than ideal.
  • Holiday payments often consist of deposits, and maybe instalments, which increase to full balances typically 60 days before a holiday is taken.
  • Acquiring banks are rightly cautious. In the event of a travel company failure, the acquirer will bear a significant proportion of the cost through chargebacks, where customers claim back the cost of an unfulfilled booking. Sudheer Sharma notes that

“Even where packages are protected under the Package Travel Regulations or bond schemes, the regulators and bodies such as ABTA can and will direct consumers to seek recompense from the credit card provider first.”

TRAVEL: A RISKY BUSINESS?

  • Since holidays are often booked well in advance, payments providers consider the industry as high risk, and as a result the offering to the travel business is less than ideal.
  • Holiday payments often consist of deposits, and maybe instalments, which increase to full balances typically 60 days before a holiday is taken.
  • Acquiring banks are rightly cautious. In the event of a travel company failure, the acquirer will bear a significant proportion of the cost through chargebacks, where customers claim back the cost of an unfulfilled booking. Sudheer Sharma notes that

“Even where packages are protected under the Package Travel Regulations or bond schemes, the regulators and bodies such as ABTA can and will direct consumers to seek recompense from the credit card provider first.”

THE TROUBLE WITH RISK?

The additional complexities mean acquirers are bad at assessing and managing risk for travel businesses:

  • Cash position and sales cycles are not well understood
  • Risk managers won’t stick their necks out for a poor risk-reward ratio

Using our trust services means acquirers are less reliant on traditional risk management and, as a result, the commercial terms offered to travel businesses improve.

CAN YOU AFFORD NOT TO?

Given recent events with Thomas Cook we are finding a lot of interest in this opportunity and it may be something that helps you too. High volume merchants that have high credit exposure may struggle to get commercial terms with any payments provider.

We know many travel businesses have trigger clauses in contracts, whereby additional security demands can be imposed almost on a whim. The uncertainty these clauses creates can be catastrophic. Reducing cashflow from a struggling businesses means failure becomes a self-fulfilling prophecy. And everyone loses.

By creating trust in the relationship, Trstpays improves stability for both parties. WIN-WIN

BRINGING YOU ON BOARD

1

Further questions?

Contact us to set up a call or meeting.
2

Kick start

Just give us the go-ahead to get started. We will need your company name and forecast annual volume.
3

Trust partner

Our trust partner, PT Trustees Ltd will share drafted trust deeds and a toolkit for implementation.
4

Commercial agreements

Discuss, agree and receive new and better terms with your preferred payments provider. Receive quotation for our service.
5

Onboard process

Your preferred acquirer will share details about their onboarding process.
6

Go live

3-way deeds and service agreements need to be signed between the acquirer, the Trustee (PTT Ltd) and yourself. Then onboarding can start.

Our panel of payments providers is ready with a better deal for you!