Why Travel Merchants Are Watching A2A Payments Closely
The travel industry’s payment stack is facing its most significant shift in decades. Account-to-account (A2A) payments, direct bank transfers that bypass card networks entirely, are projected to capture 15 to 25 percent of card transaction volume by 2026 according to Capgemini Research Institute. For travel merchants already squeezed by interchange fees on high-ticket bookings, this is not a minor trend. It is a structural change.
Travel payments have unique characteristics that make A2A particularly relevant. The average transaction size in private aviation or yacht charter often exceeds $10,000. At typical card interchange rates, that means $200 to $300 in fees per booking. A2A payments cut that to cents. The economic case writes itself.
What A2A Payments Actually Are
A2A payments transfer funds directly between bank accounts without card network intermediaries. Think of them as digitized wire transfers with modern UX: instant authorization, real-time settlement, and significantly lower cost structures.
Two variants matter for travel:
- Pay-by-Bank: Consumer-initiated transfers using open banking APIs. Common in Europe via PSD2 rails.
- Merchant-initiated: Variable Recurring Payments (VRPs) for subscription models like jet card programs or fractional ownership fees.
According to Future Market Insights, the open banking market will reach $37.4 billion in 2026, up from roughly $24 billion in 2024. That infrastructure investment is what makes A2A viable at scale.
The Cross-Border Angle
Travel is inherently cross-border. A yacht charter broker in Monaco takes deposits from American clients. A tour operator in Bangkok processes payments from German tourists. Traditional cross-border card payments involve multiple intermediaries, FX markups, and settlement delays.
The G20’s Enhancing Cross-border Payments roadmap, published by the Financial Stability Board and BIS Committee on Payments, set targets for 2027: 75 percent of retail payments credited within one hour, global remittance costs below 3 percent. A2A is a primary mechanism to hit those targets.
The Payments Association notes that linking domestic fast-payment networks creates cross-border A2A functionality without correspondent banking delays. For travel merchants, that means same-day settlement on international bookings, something card networks struggle to match.
Embedded Finance: The Distribution Layer
A2A does not exist in a vacuum. It is increasingly embedded within travel platforms themselves. According to SDK.finance, embedded banking could generate $230 billion in revenue by 2025. The mechanics are straightforward: airlines, OTAs, and booking platforms integrate payment services directly into their checkout flows.
The user experience evolves from “enter card details” to “authenticate with your bank.” No card numbers. No expiry dates. No CVV codes. For high-value travel purchases, this reduces friction and fraud risk simultaneously.
What Travel Merchants Should Consider
Capgemini’s research highlights that 77 percent of banking executives foresee disruption in debit card payments. 44 percent of banks are already collaborating with fintechs to enhance real-time payment capabilities. The infrastructure is being built whether merchants participate or not.
Practical implications for travel payment operations:
- Cost reduction: A2A transaction costs are typically 0.1 to 0.5 percent versus 2 to 3 percent for cards. On a $50,000 private jet charter, that difference is meaningful.
- Cash flow: Real-time settlement improves working capital. For operators paying crew and fuel costs upfront, this matters.
- Fraud profile: A2A authentication uses bank-grade security (strong customer authentication under PSD2). Chargeback risk shifts.
- Customer preference: 56 percent of merchants cite multi-currency support as a key capability. A2A with local acquiring eliminates hidden FX costs.
The Regulatory Context
Europe leads here. PSD2 mandated open banking. Instant Payment Regulation, effective 2025, requires euro credit transfers to complete within 10 seconds. The UK is expanding open banking into “smart data” initiatives. The US lags but is catching up through The Clearing House’s RTP network and FedNow.
For travel merchants with international clientele, this creates a fragmented landscape. A2A works seamlessly for European customers. US customers may still default to cards. The payment stack must handle both.
Key Takeaways
- A2A is scaling: 15 to 25 percent of card volume expected to shift by 2026, per Capgemini.
- Cost advantage is real: Interchange savings of 2+ percentage points on high-ticket travel bookings.
- Infrastructure is consolidating: Open banking ($37.4B market in 2026) and instant payment rails are becoming standard.
- Embedded distribution: Travel platforms will increasingly offer A2A as a default option, not an alternative.
- Geographic variance: Europe leads adoption; North America follows. Merchants need geographic payment flexibility.
The card networks built the global travel payments infrastructure over decades. A2A is the first credible alternative to that model. For travel merchants operating on thin margins in competitive markets, the timing is worth watching.
Sources: Capgemini Research Institute via LUXHUB; The Payments Association; Future Market Insights; SDK.finance; Financial Stability Board G20 Roadmap.
