A new study by Amadeus with 5,000 travelers across the world highlights the impact that ‘refund un-certainty’ is having on traveler confidence and bookings during 2021, as the industry begins its recovery.
81% of travelers confirmed that the increased risk of cancellations due to the pan-demic is a barrier to booking travel this year, with refund uncertainty (46%) and the inconvenience of the refund process (38%) topping concerns when a flight is cancelled.
According to the Amadeus study, ‘Pay When You Fly’ is the most appealing payment option (39%) compared to traditional pay at booking (36%) and ‘Buy Now Pay Later’ (BNPL) schemes that require the traveler to enter a credit agreement for the entire balance (24%).
Nicolas Ortiz, Head of Payment Product Incubation, Amadeus Payments commented:
“We’re entering a critical phase for travel’s recovery, and our industry needs to build confidence at every opportunity. We believe PWYF will drive traveler confidence, encouraging travel planning and booking even in an uncertain environment with changing government restrictions. The new approach may also result in higher value bookings because travelers only need to make the balance of the payment when it’s clear the flight will depart as planned.”
‘Pay When You Fly’ refers to a novel payment option that sees the traveler pay a small deposit, in the region of 10-20% of the total cost (which is non-refundable in the event the traveler decides to cancel). The balance is then settled a few weeks prior to departure, minimising the risk of cancelation.
