How Financial Institutions and Fintech Shape Travel Payment and Loyalty

Travel and money are deeply intertwined. Behind the scenes, banks, payment networks like Visa and MasterCard, and nimble fintech firms are all competing to capture travelers’ spending—from booking flights and hotels to dining and shopping during trips. This battle has created not only new conveniences for travelers but also lucrative revenue streams and innovation opportunities for financial and travel industries alike. In this article, we explore the evolving role of financial institutions in travel payments and loyalty programs, and the exciting technologies driving the future.

Visa and MasterCard: Centers of Gravity in Travel Payments and Loyalty

Visa and MasterCard are the titans when it comes to processing travel payments. Whether consumers are booking international flights, reserving luxury hotels, renting vehicles, or dining at airport restaurants, these payment networks want to be the default choice. The reason is simple: travel transactions tend to be larger and are frequently charged via premium credit cards linked to lucrative interchange fees.

To lock in travelers, both networks heavily invest in travel-specific credit cards with rich benefits — from free checked bags to travel insurance and exclusive access to airport lounges. They also offer travel apps that give cardholders airport lounge access, dining discounts, and real-time flight updates. These apps transform the networks from mere payment processors to travel lifestyle brands, enhancing customer loyalty.

Another key strength lies in the data. Visa and MasterCard’s transaction networks reveal detailed travel spending behaviors, from purchasing flights online to spending on transportation and dining during trips. This valuable intel enables precision marketing and personalized loyalty campaigns, boosting card usage among travelers.

Because 3 Apps is better than one...

How Airlines Monetize Loyalty Programs and Partner with Banks

Airline loyalty programs are a cornerstone of travel finance— and they generate significant revenue. The business of frequent flyer miles runs far beyond just rewarding passengers for flying. Airlines sell miles in bulk to banks and financial institutions, which offer these miles as rewards tied to co-branded credit cards. Globally, this loyalty business unit can represent a substantial portion of an airline’s revenue—sometimes up to 40% or more for major carriers.

For example:

- Emirates’ loyalty program, Emirates Skywards, has been reported to generate several hundred million dollars annually from miles sold to banking partners.

- American Airlines AAdvantage program brought in around $2 billion in revenue from selling miles and partner transactions pre-pandemic.

- Delta’s SkyMiles program is considered one of the most valuable loyalty assets in the industry, earning billions annually through miles sold and usage.

This partnership creates a win-win-win scenario. Airlines get upfront cash and lock in long-term customer loyalty. Banks gain a powerful tool to acquire and retain loyal customers who spend more to earn miles and tier status. Travelers, in turn, appreciate earning rewards that can translate to free flights, upgrades, and experiences.

In addition to miles, banks extend loyalty offers by bundling premium travel perks such as Priority Pass lounge access, luxury chauffeur services, and concierge assistance with their cards. The result is an ecosystem encouraging frequent spend and rewarding travel behavior, deepening the bonds between cardholders, banks, and airlines.

Who needs a boarding pass when you already have a deck of Emirates Skywards cobranded cards?

Fintech and Banks Innovate with Travel Perks and Cashback Rewards

Fintech companies are disrupting traditional banking by weaving travel benefits directly into their service tiers. Revolut, for example, offers travel insurance, airport lounge access, and ultra-competitive currency exchange rates as part of its subscription plans—making it appealing to travelers looking for modern, digital-first experiences. This approach challenges incumbent banks and payment networks to enhance and diversify their travel rewards if they want to stay relevant.

Traditionally, banks have provided cashback programs funded by affiliations and commissions. Cardholders earn cash or points on purchases, which they commonly redeem on travel-related services—from flights and hotels to car rentals and experiences. This "turn everyday spends into travel benefits" philosophy has become a key loyalty driver, pushing consumers to increase card usage. By partnering with Priority Pass, limo services, and premium concierge providers, banks deliver exclusive luxury travel benefits that help set their premium cards apart in a saturated market.

The Role of Data in Understanding Travel Spending

Visa and MasterCard, as the payment networks handling transaction processing, access rich metadata outlining how consumers spend throughout their journeys—on taxis, dining, retail, and entertainment.

This granular insight enables financial institutions and travel partners to craft personalized offers and tailor loyalty programs that resonate with traveler behavior. Both Visa and MasterCard offer Business and Analytical services related to Consumer behaviour (Consumer Intel so to speak) For instance, a cardholder regularly dining out during trips might receive targeted dining discounts or premium restaurant offers, increasing engagement and satisfaction.

Amadeus and the Outpayce Platform: Advancing Travel Payments

Travel tech giant Amadeus has moved beyond its core booking and distribution technology by launching Outpayce, a dedicated platform designed to streamline and secure payments in the travel industry. Outpayce provides tailored solutions including flexible payment options, improved reconciliation processes, and integrated fraud prevention—addressing the unique complexities of travel payments.

This strategic expansion enables Amadeus to participate not only in passenger bookings but also to capture value across the broader payment lifecycle, improving efficiency for airlines, OTAs, and financial partners. The move highlights a trend toward deeper integration of travel technology and financial services, offering clients a more seamless, end-to-end experience. By controlling critical payment functions, Amadeus strengthens its competitive position while opening new revenue opportunities.

Conclusion: What Does AI Mean for the Future of Travel Finance?

The intersection between financial institutions and the travel industry continues to deepen, yielding richer rewards and better services for travelers. But this evolving relationship faces a new frontier: artificial intelligence. How will AI advance travel payment processing by detecting fraud and providing faster, smarter approvals? Could AI unlock hyper-personalized travel offers, making loyalty programs more adaptive and rewarding in real time?

Moreover, will AI-driven insights create more effective partnerships between banks, fintech, and travel providers, helping each industry optimize revenue and enhance customer experience? As this technological evolution unfolds, the question remains—how will travelers benefit from AI-powered innovations while maintaining data privacy and control?

One thing is clear: the future of travel finance will embrace smarter technology, innovative partnerships, and greater personalization.