How to Manage Cross-Border Payments as International Tourism Surges Post-COVID

feaInternational tourism is back on the rise, with a significant rebound following the COVID-19 pandemic. In the first quarter of this year alone, around 285 million tourists ventured to international destinations—a 20% increase compared to the same period in 2023. According to Skift Research’s Outlook 2024, global cross-border travel is expected to reach just 3% below 2019 levels by the end of 2024, and by 2025, it’s projected to surpass those pre-pandemic numbers.

Although this recovery is certainly promising for travel organizers looking forward to the return of international visitors, it also presents new challenges, particularly in managing the complexities of cross-border payments and fluctuations in foreign exchange (FX) rates.

The Challenges of Cross-Border Payments

Managing payments across borders is more complex than it might appear. Skift’s research found that 54% of organizers consider FX rate fluctuations to be a significant hurdle for their business operations. This is particularly relevant for the 37% of organizers who depend on cross-border transactions for more than half of their revenue, where even minor changes in FX rates can significantly affect their bottom line.

Adding to the complexity, organizers must handle a variety of payment methods preferred by travelers from different countries. Imagine you’re a travel organizer in Mexico, accustomed to paying local suppliers in MXN via bank transfer. Your participants, however, come from various regions—some from the US, who prefer to pay in USD with Visa or Mastercard, and others from Europe, who might favor bank transfers via iDeal or SEPA. The more diverse your clientele, the more payment options you need to manage and the higher commissions for payment processing get.

Simplifying Cross-Border Payments with WeTravel

Recognizing these challenges, WeTravel has developed a solution designed to simplify the process of managing cross-border payments. Our platform allows travel organizers to price their trips in their operational currency while accepting payments in the traveler’s local currency, using their preferred payment method.

Here’s how it works:

Let’s say you’re a Mexican travel organizer who has priced a trip in MXN. When a European traveler goes to pay, WeTravel automatically proposes the best FX rate and allows them to pay in their local currency. This means you’ll receive the payment in MXN, exactly as you priced it, without having to worry about the complexities of currency conversion.

Moreover, with WeTravel’s Multi-Currency Checkout (MCC), not only do you get the benefit of local payment methods, but also local rates with no international transaction fees—unlike many other payment providers who charge an additional 1.5% on top of regular processing fees. All payments are processed as local, which eliminates those additional charges that can eat into your profits.

WeTravel’s Multi-Currency Checkout currently supports a wide range of currencies. Check out our Pricing Page to see the complete list of currencies.

Maximizing Value with Fee-Free Payment Methods

WeTravel not only simplifies cross-border payments but also helps you reduce costs. We do this by encouraging your travelers to use local, fee-free payment methods at checkout. These methods include ACH in the USA, PAD in Canada, BACS in the UK, SEPA, and iDeal in European countries. By opting for these methods, your customers can avoid extra fees, and you’ll receive the funds in your operational currency—saving money on both ends.

Of course, if your travelers prefer to pay with Visa or Mastercard, we’ve got you covered with lower commission rates than many other payment providers. For example, if your trip is priced in USD, European travelers can choose to pay fee-free with a local bank transfer or pay a modest 1.5% fee when using a European card. And if you’d like, you can even pass the card fee onto the customer, further encouraging the use of fee-free options.

As international tourism continues to recover, managing cross-border payments effectively has never been more critical. With WeTravel’s Multi-Currency Checkout and fee-free payment options, you can simplify the process, reduce costs, and focus on delivering memorable experiences to travelers from around the world.

For more details on the payment methods and fees we offer, check out our pricing page. To learn more about our Multi-Currency Checkout solution, visit here.

For a deeper dive into this topic, register for the "Untangling Payment Choices: Check, Card, or Digital Wallet?" session at this year's Travel Innovation Summit. Your free Attendee Pass will give you access to all nine expert-led sessions, exclusive networking opportunities, and interactive exhibitor booths. Explore the complete agenda, here: https://academy.wetravel.com/travel-innovation-summit-agenda