6 November 2024, Wed |
3:30 AM
After many months of low or no growth, the Nigerian hospitality industry is preparing to capitalize on promising future prospects. Customers now prefer to browse, research, and transact online, and hotels must ensure that they can offer as many digital payment methods as possible to their foreign customers. Fortunately, there is a secure way to collect payments from international and virtual cards, which can also assist businesses in taking advantage of new business expected in the coming months.
According to the World Travel & Tourism Council’s Economic Impact Report (EIR), Nigeria’s travel and tourism sector’s contribution to GDP is expected to grow at an average rate of 5.4% between 2022 and 2032, significantly higher than the overall economy’s 3% growth rate. According to the report, this will increase the sector’s contribution to GDP to nearly 12.3 trillion by 2032, representing 4.9% of the total economy.
Travel and tourism companies that want to capitalize on this growth, particularly in lucrative international business tourism, must consider digital payment options as part of their competitive offering.
“During the past four years operating as a licensed payment solution service provider in Nigeria, we have seen four-, three- and two-star hotels struggle to collect payment from international and virtual cards, especially from foreign customers due to limited payment facilities, and sometimes staff’s limited knowledge of payment options. This has cost hotels millions of Naira when they can’t charge checked-in guests or collect penalties from cancellations, resulting in many lost customers. Being able to charge international cards and accept foreign currencies like US Dollars will not only boost venue revenue, but foreign currency inflow for the country as a whole,” says Chidinma Aroyewun, DPO Group’s country manager in Nigeria which offers DPO Pay.
Cards are widely accepted worldwide and are the preferred payment method for business travelers. Credit cards, in particular, have longer payment terms, built-in travel insurance, more loyalty points and frequent flyer miles, and, most importantly, their spend data can be integrated into the company’s expense systems.
Offering a card service would allow venues to accept direct bookings while still being able to charge a small cancellation fee to cover costs. However, because of the ever-present threat of fraud, many business owners are hesitant to offer a more diverse payment offering.
“A Virtual Terminal allows businesses to take booking deposits through an online virtual card terminal and manually process payments without using a physical POS device. Guests can pay in the currency of their choice. The complete transparency of the system means you can display the original price, exchange rate, and final amount to your customer in their local currency or currency of choice. Our hotel merchants can now charge guests while they are making a telephone enquiry, upon receiving reservation requests from an OTA like Booking.com, or if they’re a walk in,” says Ms. Aroyewun.
Businesses can build trust with their customers and increase repeat business by providing a secure payment method. This is especially important as fraudulent activity, such as fake travel agency or airline websites, continues to rise.
Virtual Terminal allows venues to process transactions instantly and receive real-time payment confirmation without the need for or cost of a physical point of sale device. They also do not require any additional phone lines or hardware to operate the terminal. The setup is simple, and the service can be easily added to their payment options.
“Our clients are quick to share that the more payment options they offer, the more appealing they are to a wider client base. Customer experience is a key differentiator. Businesses will support a chain of hotels, or even a small boutique lodge, if they know that they can conduct business the way they prefer, no matter what country they are in. The added security of working with a known, trusted payment provider that is recognised across Africa will also help build trust and, ultimately, revenue,” Ms. Aroyewun concludes.
