UATP and Klarna are collaborating to introduce flexible payment options for airline ticket purchases. This partnership aims to provide travelers with various payment methods, such as immediate payments, short-term interest-free installments, and longer-term financing options. The initiative is part of a broader industry trend where travel and hospitality firms seek to enhance customer experience through upgraded payment solutions. The collaboration will potentially benefit airlines by increasing transaction completion rates and offering more convenient payment options to customers.
Previously, Klarna has engaged in multiple partnerships to extend its flexible payment services across various sectors. The company has collaborated with Expedia to offer flexible payments to U.S. travelers and with Uber (NYSE:UBER) to allow users in the U.S., Germany, and Sweden to use Klarna’s Pay Now option for rides. They also teamed up with travel accessories brand Away to provide BNPL options in the U.S., Canada, and the U.K. This new partnership with UATP is another step in Klarna’s expansion strategy, aiming to penetrate the $1 trillion travel industry.
UATP has consistently emphasized the importance of introducing BNPL options in the travel industry. This partnership marks a significant milestone in making BNPL more accessible to airlines and travel merchants. Klarna’s previous collaborations highlight its commitment to offering flexible payment solutions across different markets, aiming to reduce the financial burden on consumers.
Benefits for Travelers
The newly formed partnership between UATP and Klarna enables airline customers to select flexible payment options for their travel expenses. Klarna’s services allow travelers to spread the cost of their trips without incurring high credit card interest rates. This approach aims to boost transaction conversion rates by providing greater financial flexibility to customers.
“BNPL is an essential payment option for travel merchants to provide their customers,” said Zach Ornelas, senior vice president of global sales at UATP. “It offers flexibility and convenience to encourage travelers to complete transactions and boost conversion rates.”
Industry Impact
This partnership aligns with the broader industry trend of travel firms updating their payment systems to enhance customer convenience. By integrating Klarna’s BNPL options, UATP aims to support its merchants in tapping into the growing BNPL market. Klarna gains immediate access to airlines and travel agencies within UATP’s network, facilitating a quicker rollout of BNPL options.
“Travel is perfect for interest-free buy now, pay later, allowing travelers worldwide to spread the cost of their trips and without getting stuck paying sky-high credit card interest rates,” said Erin Jaeger, head of North America at Klarna.
Klarna and UATP’s collaboration provides a significant opportunity for both companies to expand their market reach. By offering flexible payment options, they cater to the evolving needs of modern travelers and contribute to the growing trend of BNPL in the travel industry. This partnership also highlights the increasing investments by travel and hospitality firms in enhancing payment systems to improve customer experience.
