For the past few decades or so, worldwide travel industry has continued to grow steadily. In part, this is thanks to the introduction of budget airlines and hotels, making it possible for anyone to travel. Travel is no longer regarded as a luxury product, but a product for the masses. While this growth is welcomed by governments around the world, this has led to more complex challenges – fraud, data management, regulatory compliance issues, and logistical nightmares.
Normally, increase in tourism numbers should benefit everyone in the supply chain; however, this is increasingly not the case anymore due to the costs of these challenges. For one, staffing and monitoring have on one hand helped the industry create more jobs, but business owners are losing out in terms of potential profits. This is also not taking into account the negative experience tourists have to endure, potentially making them only “one-time” customers. Surely distributed ledger technology (DLT), or blockchain can solve these problems?
- Efficient passenger identification
Going to the airport usually entails bringing at least two documents with you – the airline ticket and your passport. Often times, passengers also need to provide immigration forms, travel visas, or declaration forms. These documents are checked several times, and the process can be quite lengthy.
With blockchain technology, a passenger simply needs to provide a unique identifier, which can then be digitally verified by airport authorities in a matter of seconds.
- Better loyalty programs
As a frequent traveller, how do you know that your travel miles, loyalty program points and benefits are accurately recorded and stored? You don’t! Unless you spend valuable time doing the checks yourself. Blockchain technology is secure, immutable, decentralized and transparent.
Because of this, keeping track of loyalty programs and claiming the afferent rewards would be much easier. Additionally, loyalty programs can reward customers with tokens that grow in value overtime, and which can be easily exchanged for rewards on demand.
- No more middlemen
As blockchain is a peer-to-peer system, booking and paying for your next trip can be done without relying on a middleman. In return, you enjoy lower costs, and a considerably better booking experience. In other words, you can purchase your tickets directly from the airline, or book your hotel without using third parties and having to pay commissions and other service fees.
- Reducing fraud and improving payments
It is estimated that airlines lose around $1 billion yearly because of fraud, and credit card chargebacks. Paying with a digital currency is a much safer experience – since all payments are final, and can be easily tracked. Payments can easily be tracked, which means that airline companies can charge more accurate rates for micro services, such as ride, gas, wear and tear, baggage handling, and even refund the excess fees.
Based on everything that has been outlined so far, DLT or blockchain implementation for the travel industry, can surely provide both customers and companies with a variety of advantages. Other technologies such as automation and smart contracts will give birth to an array of new innovative services for travellers – such as insurance, refund for cancelled flights, and many more.
This results in increased transparency and savings – thus promoting efficiency and eventual growth of the travel industry throughout the globe.
Cover photo by: gravityflow.io
Daniel is a digital currency expert, writer, investor and ICO consultant. He writes for several top cryptocurrency publications, and will soon kick-start his entrepreneurial career in fintech, where he hopes to innovate. In his free time, Daniel enjoys travelling and collecting all sorts of thrilling experiences.