Travel Industries accept credit cards online or over the phone. Regardless of the payment method, securing a merchant account as a travel industry merchant means locating a credit card processor that can explicitly support this business type.
Travel industries suffer greatly when cancellations occur. This is quite common in the travel industry; and when monies are paid back to the client, there is a lot of time wasted from the procurement of the ticket or the hotel accommodation. The costs are not merely time, they even add up to telephone calls. In the time a travel agent used to secure a booking, which would ultimately be charged back, could have been used to secure other bookings. Furthermore, the onus is upon the travel agent to contact the hotel reservations desk as well as the airline. A great deal goes into this when a chargeback is recalled. — For this reason, traditional banks do not want the burden of these costly administrative work.
The word ‘travel’, in terms of the industry, has developed into an extremely broad and complex one. The network of businesses, agencies, and services that are associated with the travel industry are virtually endless. If you were to ask the average person what the travel industry comprises, you would likely receive answers such as a travel agent, cruise line, and resort. These answers are completely correct, but they only describe the tip of the iceberg.
The support industries that make traveling possible can boil down to almost everything in some way or another. Bus and plane industries move travelers; hotels host them; restaurants feed them, and stores support their purchasing needs. The industry supports a massive portion of the world economy. Your travel business needs to stay competitive. Utilising the best tools in the industry is how you do that—and one of the most vital tools is selecting the most suitable credit processing solution for your travel agency.
Fortunately, your travel industry has an option, an ultimate option – a TOTAL option
Are you tired of dealing with banks that say “No” to your travel business? Work with a company that says “Yes” and appreciates hard-working small businesses just trying to deliver great products and services to their clients. Your travel industry needs a specialist company to help you process credit card payments from your customers while lowering the chargeback rate.
iPayTotal’s goal is to help manage every facet of your travel merchant account and payment processing needs so that you never have to worry about it. Owing to the experience and expertise of our team, we take care of your business as if it were our own, understanding the nuances involved as well as the many frustrations when it comes to your travel industry and the issues pertaining to credit card processing.
We don’t want you merely to imagine having the freedom to focus purely on the importance of your day-to-day business, clients, etc., we want you to live it and experience it, knowing that the payment processing side of your business is well taken care of by a professional, prompt and responsive team, on your side.
The travel industry is a high risk
When most people think of “high-risk” credit card processing, they think of gambling, firearms, tobacco, and similar industries. However, travel agencies also typically fall under “high risk”. One reason for this is the higher-than-average chargeback rates. — Not to worry. Even as a high-risk business, it’s still possible to secure a merchant account to accept credit cards. Here’s what you need to know as an agency, tour operator, cruise business, or other travel company.
Primarily, it’s about chargebacks. Travel is a business in which your customers pay in advance for a service that shall take place in the future. Sometimes well into the future – months down the road. Unfortunately, life gets in the way, and a customer may decide to cancel a trip. However, you’ve already put work into booking the trip and setting an itinerary; that’s why you require deposits or impose a no-refunds policy. Disgruntled customers will often skirt that, filing a chargeback with their card company.
Below is a list for which iPayTotal helps within the travel merchant industry:
- Independent travel agents
- Travel agencies
- Tour operators
- Online travel reservation websites
- Timeshare Resellers
- Cruise lines
- Ticket sales
It is necessary to note that the need for travel merchant accounts has grown tremendously in the last few years. As the cost of air travel has gone down, making travel affordable to every individual, owing also in great thanks to the boom of the internet, the travel industry has expanded greatly.
According to reports, Travel and Tourism is one of the world’s fastest-growing sectors, with reservations closing to $1.6 trillion in 2017. The travel industry is one of the most lucrative industries on the planet. With future growth projections blowing away the current market statistics and the expanding world economy’s growth trajectories, the travel industry will continue to rise sky-high.
We advise that your travel industry stays competitive and up to date as per the market requirements. Utilising the best tools in the industry is how you do that. A travel merchant account with a high-risk merchant account from iPayTotal is what you need to keep ahead of your competitors.
At iPayTotal, our specialists will advise you based upon their experience earned in this industry. This will ensure your travel business performs at its best in arguably one of the most competitive markets in the world.
What you should know about your travel merchant account
When opening a travel industry merchant account, you will need to be aware of the hurdles that you will inevitably face. One of the primary concerns for your travel industry merchant processor will be chargebacks. Managing and minimizing your chargebacks are the surest way to keep your travel industry merchant account in a healthy state. Chargebacks occur at a higher rate in this industry because of the likeliness that the purchase is being made long before the service or product is being rendered. This time span between the two events presents the potential of changes and cancellations being made. If these changes are not managed efficiently, they can negatively impact your travel industry merchant account.
However, with iPayTotal, we share a mission: your mission is to provide the best travel experience for your clients and our mission is to help you accomplish that mission in the most productive and effective way.
What other reasons contribute to the travel industry being labeled ‘high risk’?
- The cost engaged with flights, vacations, and excursions makes most banks extremely anxious. High-ticket value cancellations and the industry’s notoriety of exceptionally large volumes of chargebacks likewise make it hard to convince financial institutions to work with these travel industry merchants.
- In addition, in most cases, a travel agent takes payment as a 3rd party. A travel agent might charge a client for a hotel stay, travel package, cruise, airline ticket, and so forth. Any change in these tickets, though not in the control of the travel merchant, leads to the travel merchant being held liable for the chargeback.
- Today, many travel agency merchants do not charge airline tickets, resorts along with other travel charges on their own merchant accounts; instead, they control it directly through the airline or travel supplier. This procedure is well respected by many payment processors, but others remain behind with a conservative approach and attempt to avoid travel agency merchant accounts altogether.
- Large transactions that exceed the average sale amount for the merchant account also trigger security concerns. Travel industry merchants who do not inform their processors of large transactions prior to charging the credit cards can trigger security concerns and cause funding delays and reserve holds. Educating and clearly communicating with the merchant on how to handle large tickets, volume spikes, and group bookings can prevent reserves, funding delays, and/or other merchant account issues.
- Another concern from the underwriters for the travel industry merchant account is the delayed delivery time frame. Delayed delivery refers to the amount of time between accepting a credit card payment (whether a deposit or full purchase) and the time the cardholder travels. The client’s credit card is billed, and the travel agent is paid, however, the trip for which the travel agent was paid does not generally take place for two to three months. This leaves a lot of time for things to change; and should the client not travel for some reason, the first thing they do if the travel agent does not issue a refund, claims a chargeback.
- Travel merchant accounts and the credit card processing capabilities they provide make it possible to realize the potential of your travel businesses. However, if you do not already know, becoming approved for a high-risk travel merchant account can be incredibly difficult if attempted without considering the many requirements that merchant providers are implementing in place because of excess fraud and defaults of companies in the industry.
- Note that just because a company can support high risk does not mean they will offer merchant accounts to every high-risk business. However, it does dramatically ease the process of securing a merchant account as a high-risk company. Once you’ve located the company or companies in which you’re interested, you can request quotes and compare costs for your merchant account for your travel business to find the right solution for your needs. When you’re ready to apply for an account with a company, you’ll need to provide various documents. These include bank or financial statements, prior processing statements (if you’re already processing), ID, etc. Remember to disclose the nature of your business upfront. You don’t want to waste your time talking to a processor only to learn later that they cannot support travel businesses.
- Travel agency merchant accounts can be tough to acquire, typically because banks are mistrusting and skeptical of the travel industry and the risks involved. Most travelers make plans far in advance, leaving lots of time to re-think one aspect and another. With all this time to ruminate, travelers tend to cancel their purchases at a far higher rate than in most other industries. — To maintain their reputation and client base, travel agencies promptly cancel with the hotels, cruise ships, etc., creating “chargebacks”. Beyond the higher rate of chargebacks, travel agencies must also deal with international clients as well as vendors.
- Travel merchants that need higher processing volumes can request new caps in as few as three months. During this time, they must prove that they pay their bills, have low chargeback ratios, and have some savings.
- Chargeback soar in the travel industry. Merchants in the travel industry are hit with so many chargebacks for several different reasons, including high average ticket prices. Most services related to travel often cost at least a few hundred dollars. Since most customers pre-pay for tickets, tours, and other arrangements before they go on trips or use services, travel merchants are considered high risk. Finally, many travel businesses end up failing due to problems with regard to travel agency credit card processing. When businesses shut down suddenly, they don’t refund the cost for services and tickets that were pre-paid by customers.
- The risk is determined based on the potential financial loss to a credit card processor or its sponsor bank. Chargebacks that are not reimbursed by a merchant are primarily what drives risk. Any unpaid chargebacks, which occur when customers dispute credit card charges, become the responsibility of processors or their sponsor banks. Additionally, credit card processors may be subject to thousands of dollars in financial penalties for each merchant account when high-risk merchants maintain excessive chargeback ratios.
- Whenever a business exceeds a 2% chargeback ratio, credit card companies can find the processor that provided the travel merchant account. When the ratios remain high, processors have no choice but to terminate their high-risk merchant accounts. To avoid placing their accounts in jeopardy, merchants must work to keep their transaction volumes high and do whatever possible to avoid chargebacks.
Why is so much information required to open a travel merchant account?
Owing to the higher risk associated with the merchant account for the travel industry, more due diligence is required during the onboarding process. This means underwriters of merchant accounts for the travel industry need to review a range of documents to assure the business is compliant, financially sound, and good credit risk. iPayTotal is unique because we underwrite merchants in-house before we submit your applications to the bank. Since our team of underwriters is experienced in high-risk businesses, your travel business is presented to the bank with all the required documents for a merchant account for travel and full disclosure, to engender trust and stability.
Presenting your business in the best possible light from point of the first contact is important because merchant accounts are essentially a line of credit from a processor. Since high-risk merchants have higher chargeback ratios and regulatory exposure, financial institutions are concerned they may violate card brand rules, laws, and regulations. Complaints to the FDA and the FTC against a merchant create liability not only for merchants but can also hold processors accountable under Know Your Customer (KYC) regulations.
Once a high-risk travel industry merchant account is approved, payment processors set monthly processing limits, for the first three to six months. This gives processors time to develop a customer risk profile by evaluating payment flows, average ticket sizes, processing levels, and chargeback ratios.
Maintaining a low chargeback ratio is key to maintaining a healthy merchant account. When chargebacks exceed card brand maximums, your travel merchant account is at risk of being shut down. If a merchant category has consistently excessive chargebacks, banks will sometimes shut down an entire vertical industry. For this reason, it is critical for high-risk verticals to self-regulate and work collaboratively to establish industry best practices.
Many credit card processing companies do not want to take risks of merchant accounts for the travel industry and deny services to this industry mostly due to credit issues, bankruptcy, or on moral grounds due to legal implications. Considering the apprehensions of a risk-related industry there are several high-risk merchant account service providers that provide merchant account services with normal rates. Just because you are a start-up business does not alone classify for risk.
It is an uphill task to obtain a merchant account for new businesses because they do not have an established credit card transforming history, large bank balances, or in the business for a long time, which is lacking for a new business. It is best to have a good business plan, copies of supplier contracts, invoices, sales, and quality assurance project reports, which give a legitimate and real hold about the new business.
Fortunately for your travel industry, we at iPayTotal are willing to help and promote this booming industry. Our extended family of travel service provider merchants, with vastly different models and product sets, are equally committed to providing optimal results, performance metrics, and profitability. While products and services vary, all travel industry clients want affordable and easy high-risk payment card processing, which is our specialty.
Features Of A Travel Merchant Account
A travel Merchant account is considered as a high-risk business, owing to the potential risk factors involved such as high-volume sales, potential chargebacks, etc. At iPayTotal, we have installed advanced fraud protection systems on our secure servers so that chargeback claims are minimized.
ADDITIONAL FEATURES OF OUR HIGH-RISK CREDIT CARD PROCESSING SERVICES FOR OUR TRAVEL MERCHANT ACCOUNT INCLUDES:
- Boost in Sales – once a Travel merchant starts accepting credit cards online, with our travel merchant account, their sales tend to increase significantly.
- Real-time Processing – our travel merchant accounts allow real-time internet facilities to accept credit card payments online
- Cost-Effective Solutions – with our travel merchant accounts, business owners gain the confidence to commence online credit card processing
- Secure Servers – iPayTotal offers secure servers so that our travel merchant accountholders feel more secure when buying and selling products online
- 24 Hours Technical Support – we provide a 24/ 7 technical support and customer service facility for our travel merchant account holders.
- Fraud Protection – travel merchant account holders are protected against credit card fraud. Our online fraud protection helps minimize the impacts of fraud on your business
- Payment Gateway and Virtual Terminal – travel merchant account holders are now able to accept all kinds of electronic payment through our secure payment gateway and virtual terminal
- Credit Card Processing Tools – iPayTotal also offers tools that can help with online credit card processing
- Expand your Business – online credit card processing allows our travel merchant account holders to accept payments from around the globe
- Risk Management – at iPayTotal we provide you with the best risk-management techniques for your travel merchant account, especially when offering online credit card processing services.
We, at iPayTotal, assess each travel industry merchant individually. We study your method of doing business so that we can board your travel industry merchant account with the acquirer most suited and beneficial for your travel business needs.
This is how we will be able to give a reliable processing solution for your travel industry.
Gain access to fraud and chargeback teams who specialise in supporting credit card processing for online travel agencies, travel marketplaces, hotel chains, car rental companies, and more. Whether you are a travel agency or you offer timeshares, we have the merchant account upon which you can depend fully.
Let us locate the best merchant account for your travel or timeshare business. We provide merchant accounts for travel, timeshare, and tour related companies. We also provide processing services for advance sales. One of the largest travel industry payment providers is iPayTotal—we are a team of industry experts bring extensive integration, PCI compliance, EMV readiness, and electronic payment knowledge while understanding the challenges faced by travel providers.
Take payments, manage transactions, and pay suppliers with one simple service. Inspire shopper confidence and increase bookings. Accept payments across multiple distribution channels and manage incoming funds and supplier payments with our network of global bank accounts.
iPayTotal is determined to provide all the advantages that low-risk businesses take for granted in their merchant accounts. Travel agency owners work just as hard and provide just as many great products as tailors, dry cleaners, and salons, after all. When you apply for a travel merchant account with iPayTotal, you will experience easy application and fast approval – take credit, debit, prepaid and gift card payments within days, all at competitive fees and rates. It’s time to keep your business expenses low with your new iPayTotal travel merchant account.
Contact us today on: +44 800 776 5988 or email email@example.com