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The Value of Alternative Payment Options for Hotel Booking Engines

Image Credit Fuel Hotel Booking Engine

When evaluating a potential booking engine vendor, hotels have many things to balance. First and foremost, core features like real-time integration with key systems. Your booking engine should be designed to convert based on consumer behavior and expectations. Secure payment processing is also a non-negotiable for any booking engine.

When evaluating the payment processing capabilities of a potential booking engine partner, consider their ability to integrate with alternative payment solutions. This includes the increasingly popular “buy now, pay later” financial technology companies. Setting up a booking engine that provides these models ensures that you are:

Read on to learn more about how alternate payment options can help your hotel stand out.

What is buy now pay later for hotels?

Buy now, pay later (BNPL) technologies act as short-term financial loans. They allow consumers to make a purchase, such as a hotel stay, and then pay for that purchase over time. It’s a convenient way for guests to make a booking they may not currently have the liquid funds to cover. Payments are typically then made automatically, in pre-set amounts from the guest’s accounts.

In a survey from 2019 to 2021, the number of BNPL loans in the USA grew from 16.8 million to 180 million. Part of this rise can be attributed to the increasing integration of technology companies like Affirm and Klarna with more and more retailers, including hotels.

For hotels, integrating these technologies into your booking engine comes with many benefits. It allows guests to pay for their visit in installments, without financial risk to the hotel, as the installment plans are created and governed by these third-party financial companies.

Fuel Travel’s hotel booking engine software allows our partner hotels to integrate Affirm as one of their payment processing options. Stand out from the competition with a booking engine that offers more payment options, securely.

Increase conversion potential 

As shown in the stats above, consumers have grown comfortable with the system of BNPL loans. Complicated payment processes can stop the conversion of a shopper into a future guest. Integrate this option into your checkout process to reduce checkout friction and boost conversation rates. The monthly payment breakdown decreases cart abandonment due to the sticker shock at the end of the booking process.

This type of payment model is especially relevant to the hospitality industry, as vacations are often a “want,” more than a need. Often, your biggest competition isn’t another hotel, it’s no purchase at all! A no-interest BNPL loan may be the difference between taking a beach vacation and simply staying at home. 

Differentiate your hotel from competitors

In a crowded market, setting your hotel apart from your competitors is crucial. Alternative payment options like Affirm can serve as a unique selling point, especially if your competitors haven’t embraced BNPL loans. Integrating this into your booking engine can help position your hotel as a property that prioritizes guest convenience, attract more attention, and stand out in a saturated market.

With many online travel agencies already adopting this technology, hotels adopting this payment option are staying on top of current trends. According to an Uplift study, 48% of consumers are very likely to use them for hotels.

Mitigate Risk, Increase Revenue

In addition to attracting more guests, adopting alternative payment methods can provide some risk mitigation, compared to traditional payment models. BNPL loan providers assume the risk of non-payment, providing hotels with guaranteed revenue regardless of guests’ financial circumstances.

In the study conducted by Uplift, 43% of guests paying with BNPL loans upgraded their stays, compared to guests using another method of payment. By adding this option, hotels gain a lower-risk payment gateway that enables users to make upgraded bookings.

For more, read: What to Look for in a Hotel Booking Engine

Learn more about Fuel Travel via a demo of our products. Contact us today.

For hoteliers seeking a booking engine that ticks all the boxes, consider the Fuel Booking Engine. Designed to meet the demanding needs of modern hotels and hotel groups, the Fuel Booking Engine provides a user-friendly interface, seamless integration, real-time updates, and responsive customer support. Elevate your hotel’s online presence and streamline the booking process with the Fuel Booking Engine.

Posted by on May 9, 2024.

Categories: Technology

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