New Orleans - In the absence of what he called a "ubiquitous" global corporate online booking solution, Travelport president and CEO Gordon Wilson during a panel at The Beat Live conference here on Tuesday said payment data would become "the center of the corporate management world" and "much more important" with regard to reconciliation than "expense management tools going forward."
Wilson during an onstage interview with The Beat contributing editor Amon Cohen said that no existing corporate online booking tool could be considered a truly global solution.
"There is a view emerging that if you take the best-in-class [online booking solution] per region or per country, and as long as you can consolidate at the data level—what's going on in terms of compliance to policy and the data you get—then what you need at the central level becomes easier," Wilson said. "That's where payments come in. If you get all the level-three [card] data so you can do the perfect matching and all the data flows that you need in terms of policy and compliance" then "companies would really have their needs fulfilled. And that is really the next frontier."
That same day, virtual card provider eNett, which is majority-owned by Travelport, announced a partnership with travel technology company Cornerstone Information Systems to provide travel management companies the ability to create virtual account numbers for hotel billing.
Revenue for eNett has grown 130 percent during the past year, Wilson said, and the company has added 400 new eNett customers. "We've barely scratched the surface of opportunity," he said. "We think the market opportunity for VANs is €780 billion of travel value transacted between travel agencies and travel suppliers around the world."
ENett, Wilson explained, resides under the "beyond air" portion of the company's portfolio, which also includes Travelport's distribution solutions for hotels and other suppliers other than airlines and jointly represents 20 percent of Travelport's revenue, while air represents 80 percent. The "beyond air" segment in 2013 grew 14 percent year over year in revenue, is growing 15 percent this year and is expected to grow between 20 percent and 25 percent in the future, according to Wilson.
One benefit of VANs is that they are created for individual transactions with specific amounts, merchants and users, making the reconciliation process easier than using a lodge card, Wilson said. Previously, travel managers had to manually match expenses using expense item printouts, he explained. "That's crazy. You don't have to do that anymore with this capability," he said.
Because virtual card numbers can't be used by unauthorized users or for purchases other than those specified, VANs also prevent fraud. As lodge cards, according to Wilson, can be distributed to multiple suppliers, "the opportunity for fraud to be perpetrated on lodge cards is enormous," he said. "The beauty of VANs is that it's single-use … and then it can never be used again."
VANs also eliminate the need for cash payments, which is a problem for TMCs that pay suppliers on behalf of clients and invoice clients later. Wilson claimed that in 2012 a Scandinavian TMC lost €600,000 when Spanish airline Spanair ceased operations. "Cash payments are a problem because if a supplier is in default the travel agency is on the hook for the money," he explained.
Additionally, eNett doesn't charge an additional fee for foreign exchange transactions, unlike some banks that may charge up to a 3 percent fee, Wilson said.