Streamline the guest journey with innovative hospitality payments

Hospitality providers, hotel franchises and property management software companies share a common goal: to deliver an excellent, seamless guest experience. Yet the payment systems at the core of many hotel operations are anything but frictionless – while guest expectations for smooth booking and exceptional stays* are higher than ever. Further, as the lodging sector contends with rising labor, infrastructure and improvement costs, maintaining healthy margins is critical. A holistic payment strategy can help control costs, elevate customer experience and drive growth.

In the latest U.S. Bank Payment Strategy Report, we surveyed more than 300 finance leaders to understand how they drive improved business outcomes through innovative payment solutions. Only 33% of lodging respondents rated their payment strategy as “advanced,” lower than other industries included in the survey.

Seamlessly embedding payments into the entire guest experience creates a competitive edge

From the moment a guest starts searching for hotels through the end of their stay, their interactions with a hotel should be simple and the payments nearly imperceptible. The ultimate guest experience should be focused on the joys of leisure travel or the priorities of a business trip, rather than struggling through the necessary touchpoints of a hotel stay. That’s why hospitality providers need a single, cloud-based payment solution to support every step of the guest journey – orchestrating in-person, online, and in-app payments anytime, anywhere.

However, industry leaders identify several hurdles that prevent them from implementing the right payment solutions and creating best-possible guest experiences:

Knowledge gaps among lodging staff

Historically, hotels have been reliant on credit card transactions for bookings, check-out and incidental charges. Pivoting to newer solutions, like digital wallets, has been more difficult due to high staff turnover* in hospitality staffing and persistent knowledge gaps for newer solutions that require training. That’s why it is critical to regularly educate all stakeholders – from executive leadership to front desk staff — on the benefits of streamlining payment solutions and improving guest experiences.

In fact, our survey showed that 64% of hospitality leaders would be open to payment innovation if they knew more about emerging technologies. Your payments provider can be a trusted advisor for the latest payments industry insights and tailored payment strategies to keep the business moving forward.

Changing technology in the hospitality sector

Many hotels still rely on legacy management systems and payment technology that hinder modernization efforts. Beyond operational inefficiencies, older systems can put hospitality providers at higher risk of chargebacks and non-compliance with PCI DSS requirements – exposing the business to potential fraud, reputation harm and guest dissatisfaction.

Hospitality leaders know that their systems are lagging – 56% of our survey respondents agreed that it has never been more difficult to update payment strategies to confront evolving fraud threats. Replacing legacy systems with modern payment solutions requires a strong business case and executive buy-in to make investments that ultimately decrease risk and protect brand reputation.

Budget constraints and tight margins

Most hotels focus on enhancing amenities to keep guest satisfaction high – but often spend less time and money upgrading IT infrastructure and payment systems. As hospitality labor and operational costs* keep margins thin, leaders have to stretch budgets strategically and prioritize guest-facing services for incremental improvements; 56% of our survey respondents reported lack of budget as their biggest challenge in transforming their hotel payments acceptance approach.

However, streamlining the payments experience can go a long way to improve guest satisfaction and chance of repeat stays – particularly, ease of booking, checking in, checking out and receiving loyalty benefits.* While there are many competing priorities, it is important not to underestimate consumer demand for convenience and lack of friction in their hotel interactions.

Opportunities ahead: workflow simplification through automation

By understanding the barriers to advancement, hospitality leaders can spend time and resources on closing gaps and preparing to implement next‑generation payment solutions to improve operations. To increase guest satisfaction and grow the bottom line, lodging companies should focus on the following solutions to remove friction from the guest experience and automate back-office processes for staff.

Real-time payments

Instant payments move with speed, efficiency and certainty – backed by the strength of the RTP® network* and FedNow® Service* – allowing businesses to increase transaction limits to support large payment values. Hospitality providers in our survey indicated high interest in implementing real-time payments solutions (56% of respondents), particularly for accepting business travel payments and paying suppliers quickly.

Mobile payments

Leisure and business travelers* increasingly prefer to book travel and accommodations from their mobile device, rather than desktop computers or through booking services – meaning that hotels must offer mobile apps and digital wallet payment acceptance to meet expectations and grow revenue potential. Further, younger travelers expect to earn personalized loyalty perks* from their hotel stays and prefer to track these benefits from a mobile app.

BNPL

Research shows that growth in the global travel Buy Now Pay Later market* is accelerating, as consumers look to travel more often and spend more during their stays. Offering flexible payment options and installment plans helps hospitality providers boost bookings and cash flows, while transferring nonrepayment risk to lending providers. Our survey research also shows that hotel leaders would prefer to consolidate the number of payment provider partnerships that they maintain (65% of respondents) – including bundling POS lending capabilities with payment acceptance services from their primary provider.

These are not just nice-to-haves – our survey shows that hotel leaders with advanced payment strategies are seeing positive results that their counterparts are not – including employee productivity (+24%), customer satisfaction (+23%) and revenue (+20%). That’s why it is critical to partner with your payments provider to create and implement a more robust acceptance strategy and invest in modernized tools to make it happen.

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