RTP allows customers to purchase airline tickets at Emirates

Emirates has announced the launch of a new payment solution in partnership with Deutsche Bank. From now on, its airline tickets can be purchased via a transfer initiation solution. A first for an airline and another step towards the democratization of this new payment method.

FACTS

• The new payment service has been named Emirates Pay. It is currently available to the airline's customers who purchase tickets on emirates.com from Germany and the UK.

• Emirates Pay is touted as a simple and secure card alternative that allows eligible customers to validate their airline ticket purchase in real time through Open-banking, debiting their bank account directly.

• Customer journey :
  • Attach a bank account to their Emirates account,
  • approve payment initiation from the mobile banking application or the attached online account to validate the purchase of an airline ticket.

ISSUES

• Emirates is the first airline in the world to launch this payment alternative powered by a white label solution developed jointly by IATA (the International Air Transport Association) and Deutsche Bank.

• Bypass credit card fees: with the IATA Pay system, adopted by Emirates, the airline will no longer pay merchant fees charged on the price of tickets paid by card, but only a fixed fee of a few cents regardless of the price of the ticket. The payment initiation solution also offers the benefit of shorter settlement times, as transfers are instantaneous.

• Optimize the customer experience: The new payment solution addresses the demand for more secure and frictionless payment options, including account-to-account payments, where a card is not required.

MARKET PERSPECTIVE

• A recent AmEx market study on airline ticket payments noted that these purchases are often impulsive and that frictionless is important in this case.

• According to the information provided by the airline, this solution is also based on the Request to Pay scheme. This new payment standard is supported by the European institutions to promote competition and allow the emergence of new routes and new uses that could upset the balance. Emirates will certainly not be the only airline to evolve its payment process in this way.

• Taking card schemes out of the purchase loop also raises the question of associated services, and in particular insurance, which could see new players enter this new purchase path.