Payment approval rates for travel have increased by 8.8% in the Middle East and North Africa (MENA), finds a new report from Checkout.com, an international provider of online payment solutions. In the fourth quarter of 2018, the approval rate rose by 5.1% bringing MENA’s rate just 3% behind the rest of the world. Due to the high transaction value in the travel industry, card approval rates have seen a slower growth rate than other industries, such as e-commerce.
The 2019 Online Payments in the Travel Industry MENA report connects the rise in approved travel payments to the greater availability of lower cost trips from Saudi Arabia, where the ticket prices have reduced by 7.4% between 2017 and 2018, and the rise of use of MADA online cards also contributed to the approval rate.
In Saudi Arabia, roughly one-third (37%) of bookings made within a week of travel were purchased through a desktop computer, while 58% were made with a mobile device. Across the MENA region as a whole, mobile bookings are less common. Approximately 31% of bookings made within a week of travel are purchased on a desktop computer and 36% are made via mobile device.
Compared to the rest of the world, Checkout observed MENA travel merchants process 21% more payments through 3D Secure and charged back 0.04% less payments.
Remo Giovanni Abbondandolo, Vice President of Business Development, Middle East and North Africa at Checkout.com said: “The increasing use of MADA online cards to reach 36% since inception in April 2018 and falling holiday costs in Saudi Arabia is boosting the travel industry and payment processing trade. Local and global travel business operating in MENA must prepare for further growth by partnering with a payment processor that can handle their customer’s security needs in a timely manner.”
Guillaume Pousaz, Chief Executive & Founder of Checkout.com commented: “The growing travel payment approval rates in the Middle East and North Africa show that the region is increasingly sophisticated and diverse in its approach to online payments. More importantly, card issuers are increasingly trusting the merchant category when the transactions are originating from well-established acquirers, which is a relevant barometer for online card payments maturity in a given geography. I am excited to have witnessed how the GCC market has evolved since we established our local office here in 2014 and discover what lies ahead”.
2019 Online Payments in the Travel Industry, MENA was launched at Web In Travel Middle East and is available for download here: https://www.checkout.com/travel