London - Corporate payment
services specialist AirPlus International has developed a prototype mobile
phone payment process that attaches such employee details as project code or
cost center to transaction data. While enriched data of this nature is a
familiar benefit of the AirPlus centrally billed account, or lodge card, the
ability to add similar details for on-trip purchases suggests a potential
benefit for mobile payments in preference to traditional plastic.
AirPlus
chairman of the executive board Patrick Diemer demonstrated the prototype at a
press briefing here on Thursday. Meanwhile, UK managing director Yael Klein detailed
a prototype client benchmarking tool and also revealed an AirPlus deal with Her
Majesty's Revenue & Customs to treat as value-added tax-compliant the statements
on car rental transactions paid through centrally billed accounts.
Diemer
said AirPlus this year will pilot the mobile prototype among its own employees,
with a view to launch it for customers next year—assuming the technology is proven
fast, easy and secure.
The
company's strategy envisions a wallet app from which users can choose either the
virtual equivalent of their plastic corporate card or AIDA, the AirPlus
one-time virtual card number that can be designated for use with a specified
merchant and for a specified amount.
If a virtual
corporate card is produced to check out of a hotel, the mobile app uses GPS
positioning to identify the hotel and asks the cardholder to confirm—a
potentially new solution to the long-standing problem of hotel misidentification.
However, one remaining burden is paper. "You will still need to collect a
paper invoice for VAT purposes," Diemer said.
AirPlus
has had better success vanquishing paper when it comes to car rental. Following
a deal implemented last year to accept on the lodge card (Company Account) payments
for Avis vehicles globally, the company recently pulled off the VAT deal with
HMRC. Klein said AirPlus later this year aims to offer VAT-able invoices in the
United Kingdom, although rental providers must confirm their participation with
HMRC. Diemer said the deal promises significant processing efficiencies. "It
allows customers to put our invoice automatically through their systems,"
he said. "The deal-breaker that was preventing full automation was the
need for a VAT document."
Meanwhile,
the announcement of the Travel Metrics client benchmarking project seemingly signifies
another AirPlus strategy: aggregating data. Still in early development, and in
consultation with a couple of key clients, Travel Metrics is intended to allow
customers to compare airfares paid by city pair and fare class, especially for
corporate net fares. As well as benchmarking among customers, the objective is to
enable clients to benchmark internally, comparing different cost centers or
national operations, for example.
Klein
said AirPlus is considering buying data from other sources to augment Travel
Metrics and she drew comparisons with the company's SAP partnership, launched
last year. Under that arrangement, mutual customers can request that SAP feed data
from completed expense reports back to
the AirPlus management information tool. One example is hotel data, where the
traveler in the expense report has added to the original pre-populated
corporate card feed such details as arrival and departure dates and number of
room nights. "This is just the start of bringing data together so
customers no longer have to use five or 10 different management information
tools,” said Klein.
Diemer
also gave an update the AirPlus Debit Account product launched last year. Intended
to help companies avoid credit card surcharges on travel agency bookings imposed
by many European airlines, the AirPlus Debit Account controversially was announced on the same day in August 2011 that parent Lufthansa group communicated card
surcharges. Diemer said AirPlus has 1,200 customers for the Debit Account, most
of them in Germany. Eighty percent of Debit Account customers also use the
Company Account. In general, he said, customers that are signed up to both
accounts use the debit account for Lufthansa Group flights but the Company
Account for other airlines. AirPlus charges €3.40 per transaction made through
the Debit Account, but waives the fee for bookings on Lufthansa Group airlines.
Overall,
AirPlus in 2011 added 3,000 customers and now claims 38,000. Its full-year issuing
volume of €10.3 billion was up 17 percent from 2010 and nearly was double the €5.2
billion in 2006. "We did not expect 2011 to be such a boom year,"
said Diemer. AirPlus for 2012 set a more conservative target of €11.2 billion,
owing to the eurozone crisis. Diemer said transaction volume in January was up
16 percent year over year.
The top
growth market for AirPlus in 2011 was China, thanks not only to the its largely
untapped potential but to AirPlus being the only Western company permitted to
sell corporate payment services there. However, Citi last month announced it received
regulatory approval to start issuing credit cards in China. "We have not
seen Citi on the ground yet, but I expect that will happen," said Diemer, noting
an awakening in interest in corporate payment systems among such large Chinese
corporations as computer manufacturer Lenovo.
AirPlus
also revealed average 2011 customer transaction figures. Average ticket price
climbed for the second year in succession, up 3.4 per cent to €543, but has not
returned to the 2008 level of €565. One reason average ticket price climbed was
a larger business-class mix, up 2 percentage points to 9 percent—but still
nowhere near the 2001 figure of 43 percent.