Mastercard and Agoda Unite for Improved B2B Payments in the Travel Sector
In a significant development within the travel and tourism industry, Singapore’s leading digital travel platform, Agoda, is embarking on an extensive collaboration with the global payments giant Mastercard. This partnership marks a pivotal step towards modernising and simplifying business-to-business (B2B) payments in an industry that has traditionally grappled with outdated and time-consuming processes, such as manual paper invoices.
Modernising B2B Payments
As the travel sector undergoes a profound digital transformation, there is an evident need to restructure existing payment systems. The partnership between Agoda and Mastercard is poised to redefine how digital travel platforms engage with their global network of hotels, airlines, suppliers, and vendors.
Yunsok Chang on Collaboration
Yunsok Chang, Executive Vice President of Market Development, Asia Pacific at Mastercard, expressed his enthusiasm, stating, “Mastercard has a longstanding partnership with Agoda, and we are excited to extend this collaboration, which leverages the power of cooperation to simplify B2B payments, enhance fraud protection, all while elevating the customer experience and fostering greater loyalty.”
Digital Dominance in Travel Bookings
Digital travel platforms currently account for 40% of all global travel bookings, as noted by data from the Pacific Asia Travel Association (PATA). These platforms play a pivotal role in facilitating the operations of airlines, hotels, tour operators, railways, cruise lines, and various other industry partners.
Mai-Linh Bui’s Vision
Mai-Linh Bui, Chief Financial Officer at Agoda, emphasised the urgency for change, stating, “Recognising the challenges posed by outdated payment processes, our collaboration aims to revolutionise the way digital travel platforms engage with hotels, airlines, suppliers, and vendors worldwide.”
Innovations in Payment Processing
A vital facet of this partnership is the exclusive issuance of Mastercard virtual credit cards, a technological innovation that will enable Agoda to conduct B2B transactions globally, wherever Mastercard is accepted. This enhancement promises to introduce greater efficiency and security to the payment process, bolstering the travel industry’s defence mechanisms against fraudulent activities.
Enhancing the Customer Experience
Furthermore, this partnership aspires to transcend mere payment processing. It intends to enhance the overall travel experience for customers by offering timely and tailored offers through the utilisation of Mastercard’s data-driven insights. Joint marketing initiatives will augment customer satisfaction, and loyalty rewards will be extended to individuals who book with Agoda using a Mastercard.
Addressing B2B Payment Complexities
B2B payments in the travel and tourism sectors have long been afflicted by complexities, as revealed by PYMNTS Intelligence’s “Smart Receivables Playbook.” An astounding 20% of travel and tourism businesses identify B2B payments as a significant challenge, with an additional 43% deeming them somewhat substantial. This underscores the urgency of introducing innovative solutions to this realm.
Matt Clark’s Perspective
Matt Clark, CEO of Corcentric, highlighted the shift towards consumer-centric solutions, stating, “When it comes to efficiency and digitisation, you need not look further than B2C today to envision the future of B2B tomorrow.”
Mastercard’s Trail of Innovation
First-Party Trust Program
Moreover, in recent times, Mastercard has been actively engaged in multiple strategic initiatives and product launches across various geographical regions. In October 2023, the company unveiled its “First-Party Trust” program, aimed at safeguarding small businesses and merchants from fraud and other online threats. Collaboratively developed with industry groups and organisations such as the US Merchant Advisory Group and Merchant Risk Council, this program addresses the growing concern of first-party fraud, wherein transactions are erroneously or intentionally disputed by cardholders. The program enhances transaction transparency, allowing merchants to share vital insights to combat first-party fraud effectively.
Consulting Services Expansion
Continuing on the path of innovation, Mastercard expanded its consulting services, with a particular emphasis on artificial intelligence (AI) and economics. These services aim to assist businesses and merchants in embracing AI and enhancing customer experiences and revenue growth. The expansion includes the launch of dedicated practices for AI and economics, aiming to streamline the adoption of AI securely and rapidly across various industries. It also seeks to address shifting macroeconomic forces and evolving customer preferences, ultimately driving business transformation.
Digital Labs Initiative
Furthermore, Mastercard’s commitment to advancing business transformation extends to its “Digital Labs” initiative. This initiative empowers users to design end-to-end products, from concept development and rapid prototyping to launch and scalability. By providing businesses with a platform to harness AI, embrace economic trends, and design innovative products, Mastercard is actively shaping the landscape of modern commerce.
A Catalyst for Industry Evolution
In essence, Mastercard’s multifaceted approach to innovation underscores its dedication to pushing the boundaries of what is possible in digital payments and business transformation. The collaboration with Agoda is just one example of Mastercard’s commitment to simplifying complex processes, enhancing security, and delivering an exceptional customer experience. As the travel and tourism industry evolves, partnerships like these promise to catalyse change, ushering in a new era of efficiency and innovation.
