Chargebacks E-Commerce Payments

Travel Business Merchant Account: the Essentials

2020 February 27


Travel Business Merchant Account: the Essentials

The travel industry has been on a rise for decades, but have you ever wondered what is the reason behind it? One of the explanations could be that the world is getting more and more open as globalisation has reached almost every corner of the planet. That means travelling has become more accessible for the majority of the population. People are also changing their approach to travelling: it is not a luxury anymore, and most people can afford at least one trip abroad a year. As the demand rises, so does the supply. Because of that, we see more and more travel services available on the internet.


Firstly, let’s start by determining what we call a travel business merchant. Essentially, it could be any online business selling travel-related goods/services on the internet.

The most common travel business models are the following:

  • Accommodation and vacation rentals (hotel, apartment, beach house, cabin, etc.)
  • Car rental companies
  • Cruise operators
  • Transport (bus, rail, ferry, etc.) tickets
  • Travel agencies
  • Vacation packages
  • City tours

However, keep in mind that there could be other travel business models not mentioned in the list above. If you are not sure if your business model can be supported, feel free to contact us.


If you are not new to the online payments industry, you may know that the travel industry is commonly regarded as high-risk. These are the main reasons why:

  • A high number of cancelled orders/reservations. People tend to cancel travel-related services quite often, whether it is a hotel reservation or a city tour. Cancellations are usually based on people’s personal decision, however, sometimes trips get called off because of some force majeure: a hurricane, deadly virus, a flood, etc.
  • Another reason is the high transaction value. This one is self-explanatory as high transaction values mean a higher risk of fraud and chargebacks.
  • The period between the booking date and the service itself is usually quite long in the travel business. That could be another reason why online travel businesses are labelled high-risk. The merchant should be reputable to ensure that a service which was ordered months in advance will actually be provided.
  • When travellers are left unsatisfied, more frequently than not they will file for a chargeback instead of asking for a refund. This happens because most customers cannot tell the difference between a chargeback and a refund. An increased number of chargebacks means higher risk.


All online businesses should be aware of the possible risks when selling online. That is why we recommend that all online merchants adopt at least the basic fraud protection measures. Accordingly, high-risk businesses should be extra vigilant and take additional fraud protection measures if necessary. Here is a few tips which can help prevent fraud and minimise the risk of chargebacks:

  • Be careful when choosing a payment service provider. Work with a reputable institution with an experienced risk management team. They will help you notice possible fraud before it happens and assist you in case you face an illegitimate transaction or a chargeback.
  • Integrate 3D Secure – it is a must for every high-risk online business. It is an extra step in the payment process which double-checks the identity of the buyer.
  • Always monitor incoming transactions and look out for any inaccuracies or red flags.
  • Make sure your customer support team is always ready to help. In case a customer wants to make some changes in their order or ask for a refund, always be there to assist.
  • Follow the news and the latest trends in the payment and fraud prevention industry. Cardinity blog could be a great place to start – we have prepared a bunch of informative articles about fraud prevention and chargebacks, all of them can be found here.

Online travel businesses have made travel easier and more accessible for the majority of people. However, some peculiarities of this industry (such as high transaction volume or large cancellation numbers) make it high-risk. It means that you need to implement more fraud prevention measures to avoid chargebacks or other problems.

If you have an online travel business and are on the lookout for a payment service provider which works with this industry, check out our website for more information.

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