As suppliers flock to the virtual card space,
AirPlus International president and CEO of the Americas operations Yael Klein sat
with BTN payment editor JoAnn DeLuna during The BTN Group’s The Beat Live
conference in Arlington, Va., in early October.
What gains has AirPlus made in the past year?
It has been a very good year for us, up 13 percent in
revenue in the U.S. compared with 2014. This year, the U.S. doubled new signed volume
compared with what we’ve signed in the last couple of years and [ranked] third in
new signed volume compared with our other 70 markets. We’ve been focusing on pain
points and finding specific solutions for certain industries not only here in the
United States but globally. Universities, oil and gas and staffing companies
historically do not have a decentralized corporate card because they have a lot
of infrequent travelers or guests they have to facilitate. Universities have to
report on grants and budgets in very different ways, and they have to be more
transparent. To help them with that and their data needs is something our
solution lends itself to: the virtual cards, of course, but also the normal
lodge cards that we’ve had for years.
So do you plan to add any features, products or
integrations to your offerings?
We’ll be launching our own U.S.-specific mobile
app hopefully in January. We decided to have a different approach to mobile. Basically
we’re making sure it’s embedded more to the U.S. environment. It will up the
transparency and help travelers with the use of mobile payments. I can’t give
details, but watch this space.
More players have entered the virtual card space
since even the Global Business Travel Association conference in July. Is the
market saturated, or is there enough volume to go around?
There’s plenty. With all these new developments,
it’s the same old players in the background. Say a GDS were to announce a new virtual
card product. One of us will be in the background. They themselves will not
launch into the payment industry but will embrace one of the players out there and
will be cobranded with one of us. For us, it’s an additional sales channel.
Also, the more people sell virtual cards, the more they will get it accepted,
and that’s a good thing. When we were [one of the few providers] that came out
10 years ago, it was a very lonely place and we had very different
conversations with hotels all over the world about why they should accept these
very strange cards. We no longer have these discussions, or we have them in
remote areas. So more people coming into the market is a good thing.
What do you think of Grasp and Wex’s new virtual
card solution, GraspPAY,
which claims to be free and thus changes the existing business model?
We’ve never charged [clients] per transaction
for virtual cards. It’s been AirPlus’ business model for years. Hotels pay us
for accepting our card. No TMC or corporate has paid us for using virtual cards.
Nonpayment travel suppliers are getting into
payment, as well. Why the sudden attention to the space?
People expect payment to be a silent
facilitator. With new virtual cards coming in, technology partners have to
start adjusting, and suddenly we’re talking about it again. The corporate cards
or lodge cards were an integral part for many years. Then virtual cards came in
and for many that was a disruption because it was a manual thing, as they had
to generate a virtual card here and put it into the GDS there. Everyone has
been adapting now, but we’ve been doing it for 10 years. Virtual cards need to
be part of the natural flow and need to be part of the no-touch environment because
as soon as you have a disruption, the process optimization you’re trying to
achieve goes downhill.
During The Beat Live conference, American
Express Global Business Travel chairman and Certares managing partner Greg
O’Hara said Certares is looking to invest in the area. How do you view payment’s
role in the travel industry?
Payment has always been an integral part of the
entire equation. The U.S. is a very mature payment market, with 70 percent of
companies having some sort of payment mechanism, be it corporate cards, virtual
cards, lodge cards or a combination. When you look at things like open booking
or Lufthansa’s announcement [of a €16 surcharge on global distribution system bookings], payment seems to be the glue to get it back
together, but a very silent glue in the background. If the GDS can no longer do
the reporting, cards still can.
Correction, Oct. 9, 2015: A previous version of this report incorrectly stated that American Express Global Business Travel chairman and Certares managing partner Greg O'Hara said Amex GBT is looking to invest in payment. Certares is the entity interested in payment.