PIN Debit transactions are more cost-effective for airlines

The Acculynk service was added this week to the list of payment options admitted at Universal Air Travel Plan’s alternative-payments initiative for airlines becoming thus the fifth payment processor partnering with UATP to provide alternatives to credit cards for online ticket sales. Acculynk Inc. will process PIN debit transactions online for airlines that choose to enable the option through UATP’s switch.

As per Tom Cunningham, vice president of business development for Washington, D.C.-based UATP, which provides corporate credit accounts and transaction processing for many of the world’s largest airlines the connection to Atlanta-based Acculynk will be live within 30 to 45 days.

Four other processors that earlier entered into the same deal with UATP include Bill Me Later Inc., HomeATM, a Montreal-based processor, PayPal Inc. and Moneta Inc.

PIN debit transactions feature a number of advantages over the credit cards including lower transaction costs and fast, guaranteed payment through the electronic funds transfer networks. Today merchant processors increase holdbacks on airline credit card sales while PIN debit transactions generally clear the same day. At present a $500 fare might cost an airline around $10 to accept on a credit card while the same transaction might entail two times less on a PIN debit card with EFT network interchange of 0.75% plus 15 cents. Moreover, the transaction may be even cheaper when processed through networks that have interchange caps, which typically are 65 cents