A look into the current trends in travel and tourism.
While Covid-19 well and truly impacted every business across the globe, few sectors were hit as hard as the travel industry. Due to public health measures such as local lockdowns and tourism restrictions, travel in many parts of the world came to a standstill over the last few years. And now, as we enter the summer holiday season of the third year of the pandemic, we’re excited to share that travel has bounced back – and both the payments and fraud industries have a huge opportunity to protect consumers as this vital industry continues to take off.
First, let’s look at the data that ultimately affects the current trends in travel and tourism<span :
- Mastercard’s Travel 2022: Trends & Transition Report also shows that both leisure and flight bookings now surpass pre-pandemic levels – a key milestone for the travel industry.
- People are also starting to travel farther from home, according to Mastercard’s research. Long-haul leisure travel shot up as well, just -7% below pre-pandemic levels by the end of April.
Simply put, consumers across the globe are eager to travel again. Let’s dig in and investigate the travel industry trends affecting us all.
Travel (and Fraud) Take Off
As interest in travel – and air travel – rises, opportunities for fraudsters are sky high. This was particularly evident post 2020. In fact, according to ACI’s numbers, travel fraud attempt rates were up 3% and ticketing was up 2.1% in the latter half of 2021 compared to the same time the previous year. With fluctuating restrictions in different regions, many consumers have less lead time to plan. So how do these evolving online travel industry trends affect the industry? Simply put, these spur-of-the-moment ticket purchases make it difficult for merchants to identify and prevent fraud before a person transacts.
As ACI warns, customers and merchants without sophisticated protection are increasingly more vulnerable to fraud. And, current online travel industry trends point to further merchant losses to online payments fraud; expected to hit $206 billion between 2021 and 2025. Moreover, fraudsters are evolving their tactics. According to the Merchant Risk Council Global Fraud Report, the most prevalent forms of payment fraud have shifted significantly since 2019, with card testing and friendly fraud – where the consumer requests a chargeback from their bank after receiving a purchased product – are now the most common fraud tactics impacting merchants.
Where to go From Here?
For industry merchants that weren’t furloughed during the initial stages of the pandemic, the sudden stop in day-to-day activities allowed them the opportunity to “get to work,” tweaking, rewriting, and even rebuilding their rules-based symptoms from scratch. Merchants who evolved their approach to fraud are likely experiencing lower chargeback rates now than pre-pandemic.
For others, there’s an opportunity now to invest in fraud prevention platforms that both streamline the consumer experience and reduce risk for the merchant. The latest corporate travel industry trends point to us seeing merchants across the board invest in sophisticated fraud prevention platforms to keep pace with fraud and consumers’ rising expectations
As travel resumes and merchants adapt, ensuring merchants protect their consumers’ identities while providing seamless experiences is more critical than ever before.
To better understand how Ekata & ACI Worldwide can help transform your risk management program, please contact us today.