Industry groups working to improve B2B payments
Industry groups working to improve B2B payments
10 JUNE 2020 7:25 AM

Legacy systems make business-to-business payments insecure and inefficient. HTNG, HEDNA and the OpenTravel Alliance are working to change that.

REPORT FROM THE U.S.—While much attention has been paid to consumer-facing payment systems and the security risks and other issues they present, comparatively less bandwidth has been dedicated to the issues presented by the various business-to-business payment streams hotels deal with.

Legacy distribution systems present possible security issues with no standardized software standards, business rules or best practices, according to Hospitality Technology Next Generation’s Open Payments Alliance (OPA) Standards workgroup, which is a collaboration between HTNG, HEDNA and The OpenTravel Alliance.

Here are highlights from a recent webinar conducted by that workgroup on their efforts to create unifying standards for B2B payments in the hotel industry.

An attempt to automate
Group members acknowledged many of the current B2B payment processes are handled manually by front-desk associates due inefficiencies introduced by legacy systems. Creating unified standards will allow for the creation of new payment manager tools that remove both the risk and time of having more hands and eyes on payment information.

Mike Carlo, CEO and founder of XanderPay, who is the group’s liaison from HEDNA—which originally created the Open Payment Alliance—said much of the work is still done via fax. He said a payment manager is “necessary to automate the front desk” in general. Those systems will also make for better, more widespread acceptance of virtual credit card payments.

With current legacy systems, Voxel Group President Xavier Ginesta, who has worked on the project through both HEDNA and HTNG, said hotels struggle with high volumes of B2B payments, including problems such as losing credit card information, storing in non-PCI compliant ways or charging incorrect amounts. He said programs already exist for automation but there currently aren’t standards that allow them to work together effectively in the distribution space.

Where the project stands
The current working idea for the group is to “decouple” bookings and payments while having distribution channel manager systems and new systems called payment managers work in parallel to complete their intended function.

Ginesta said a payment manger acts as “a communication channel that receives payment instructions on one end and sends those payment instructions to the other end.”

That manager would unburden systems like central reservation systems while making sure a hotel’s property management system has accurate and full payment information. Payments for things like food and beverage often don’t live within the initial booking and authorizations typically come via fax, he said, and a payment manager would remove the need for faxes and manual input. Payments are executed automatically once the right conditions are met without the need for human intervention, which reduces security risk for the hotel because they’re not directly handling payment information.

The group recently reached a milestone in releasing the standards for a first phase API to connect payment managers with PMSes.

What’s next
Those initial stages connect payment managers and hotels. The next step for the group will be connecting those systems with third parties like travel management companies and online travel agencies. That functionality currently exists with some systems, but not as a widely accepted standard.

The group is broadly looking for more participation across the industry, and Ginesta said with the industry largely at a standstill, it is a good time to move toward greater automation.

1 Comment

  • Richard Welch June 16, 2020 11:39 AM Reply

    How about getting rid of debt cards. That would be the most helpful thing you could do for a hotel.

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