Payment Friction
According to Adyen’s UAE Hospitality Report, the disconnect between consumer expectations and hotel offerings could be costing the industry dearly. While 62% of consumers believe that having a variety of payment options is crucial, only 11% of hospitality businesses in the UAE prioritise this aspect. As many as 32% of these businesses cannot currently accept popular payment options like Buy Now, Pay Later (BNPL) and digital wallets, despite these methods emerging as preferred choices among guests.
The survey revealed that a staggering 64% of respondents consider a seamless payment experience vital from booking to check-out. Issues related to payment processes not only lead to lost bookings—26% of guests have experienced payment-related problems like card declines and incorrect charges—but also deter future visits, as guests express dissatisfaction over financial experiences.
Commenting on the report, Sander Maertens, Head of Middle East at Adyen, said, “We have noticed a stark contrast between hotel guests in the UAE and their global counterparts, with higher expectations among UAE guests, particularly when it comes to payment options. For instance, around 37% of guests in other global markets would abandon the booking process and choose another hotel if their preferred payment method wasn’t available. In comparison, this figure rises to 63% among UAE guests.”
Lack of payment flexibility is a deal-breaker
Offering a wide range of payment options is essential to more than half (62%) of consumers surveyed in the UAE, with 37% admitting that having more options would encourage them to make more significant purchases. Three in ten (37%) respondents said they do not prefer paying the total cost of a hotel upfront – reflecting a broader shift towards careful budget management and mirroring the rise in popularity of BNPL services.
Cancellation policies are well-researched
Flexibility in cancellation policies also emerged as a critical factor in hotel selection, with 62% of respondents considering free cancellation 24-48 hours before arrival as a dealmaker. The data underscores a traveller’s desire to ensure plans can be adapted last minute.
Financial experiences affect returning travellers
According to the survey, many hotel guests in the UAE have chosen not to rebook a stay due to finance-related issues or grievances. Specifically, 26% reported problems with payments, such as card declines or incorrect charges, while another 26% cited concerns over being asked to share card details over the phone. Additionally, 22% experienced delays with charges or refunds, and 19% noted overpayment due to errors. Addressing common payment grievances can help build trust and encourage repeat business.
Commenting on the report, Sander Maertens, Head of Middle East at Adyen, said, “We have noticed a stark contrast between hotel guests in the UAE and their global counterparts, with higher expectations among UAE guests, particularly when it comes to payment options. For instance, around 37% of guests in other global markets would abandon the booking process and choose another hotel if their preferred payment method wasn’t available. In comparison, this figure rises to 63% among UAE guests.”
Today’s guests demand easy booking processes, seamless transactions and hassle-free cancellations, otherwise they may decide to go elsewhere, especially in the UAE. In conversations with senior leaders at local hotel businesses, Adyen found that 66% plan to enhance and improve their payment journey within the next 12 months. Additionally, 65% stated that investment in financial technology capabilities could offer a differentiated service over competitors.
With potential guests abandoning bookings due to payment inflexibility and some not returning due to finance-related issues, the hospitality industry must urgently examine how experiences can be enhanced in an era where every touchpoint matters and payments are no longer just a transaction.
By Gloria Methri
