Avinode Launches PayNode To Accelerate Charter Payments
Fourteen years after Avinode launched its Marketplace product, the innovative Swedish company is using NBAA 2016 to launch PayNode. It’s the latest platform from the company that specializes in connecting those wishing to charter business aircraft with available operators. The new charter payment system is designed to revolutionize the way charter booking works by making payment an electronic process.
Heading up PayNode, now the third company in the Avinode group, is Magnus Henriksson, who was quick to say that PayNode is for the charter marketplace what PayPal is for eBay. The technology is meant to bring business aviation into the 21st century by adopting modern technology, he said.
Henriksson, who was previously business manager for Avinode Business Intelligence (with its Demand and Pricing Indexes), told AIN, “Payment is an area we’ve seen as an opportunity for quite a while, especially since 2014 when World Fuel [through its subsidiary] MultiService bought a majority share of Avinode.” MultiService is a specialist in electronic payment technology, so it was a logical acquisition for the group.
“In mid-2015 we initiated this project and spent a lot of time interviewing key clients and testing the hypothesis. We wanted to understand how payments worked–and it was a real eye-opener,” Henriksson continued. “It was a much bigger pain for the industry than we realized–inefficient, expensive and time consuming.”
The average charter transaction, he said, is $35,000, but consists of two separate transactions, “payer to broker and broker to operator. The problem is the operator won’t take off until they have the money and the broker won’t pay [the operator] until they have been paid.” This typically creates delays, “for bookings that happened 48 to 72 hours before,” he said.
“Then we spoke to American Express, which [handles] 10 percent of payments in this industry; by far the most predominant card. The first thing we’re doing is Amex processing–which is what we’re [going to go live with] at NBAA–and then we have a roadmap to take on the wire-transfer solution, with a completely new way [for this industry] of moving money.”
Henriksson told AIN that a pilot project has already been running with selected brokers and operators, “so we could test it and get feedback during development.” There has been a “very positive reaction. The feedback has been fantastic from clients–operators and brokers–in Europe and the U.S. It’s the simplicity rather than [lower costs] that really attracts people to it.”
So now the clock is ticking towards the day when old-fashioned payment processes in business aviation charter become a thing of the past, and according to Henriksson this could come sooner than most expect. Photocopying IDs and the fronts and backs of credit cards will be eliminated with PayNode. Users need not be members of Avinode or its SchedAero sister company.
“We’re ready to go, and we’re signing up clients right now in the U.S.,” he said. The plan was to go live before the NBAA show, with a few clients in the U.S., followed quickly by Europe. “Our focus initially is EEA [European Economic Area] countries and North America.” He added that the transaction side would be brought in gradually, beginning in early 2017. PayNode will be free, in that there is no upfront cost or membership fees, but fees will be applied to transactions.
“PayNode will be integrated into the Marketplace workflow,” Henriksson said. “We hope all Marketplace users will go over to it, and eventually transactions will be 24/7/365. Our plan is quite aggressive. We have the solution, and we know what to do.”
Finally, Henriksson said that users would not have to worry about security as PayNode takes care of that, under PCI-DSS (Payment Card Industry Data Security Standard). “You need to be PCI compliant, but PayNode will take that responsibility on,” he said.
Original article: Avinode Launches PayNode To Accelerate Charter Payments