Travel tribulations: One-time, upfront payments are turning off travellers

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Paying upfront for holidays has caused frustration among online shoppers, as 16% complained of spending their holiday budget before they even travel, according to new research from payments provider, Klarna.

In a report that was commissioned by Klarna – a payments provider which prides itself on being ‘smooth’ – it showed that the steep upfront costs of paying for travel online has had a negative impact on people’s holiday experience. Over 1,000 UK consumers took part in the survey, and 18% said they were being forced to skimp and save, even before they arrive at the destination, forcing them to settle for trips with lower standards.

More than 12% said they’d prefer an upgrade, but unfortunately could not afford the upfront costs. But it’s not only trip quality that travellers are sacrificing: 25% of the respondents reported to actually missing out on holidays, for the reason that not everyone can afford the lump payment.

“Browsing for and buying travel should be as exciting as packing for your trip”

Commenting on the research, Luke Griffiths, managing director at Klarna UK, said: “The holiday countdown begins at the moment of booking, so browsing for and buying travel should be as exciting as packing for your trip or heading to the airport. Sadly, our research shows this isn’t the reality for many UK holidaymakers.

“It’s clear that travel providers need to do more to make shopping for travel online more accessible and enjoyable for consumers, from providing quality customer support throughout the purchase journey to offering deferred payment options at checkout.”

These negative connotations are deeply affecting both the consumers and travel vendors. The study showed that 16% of the consumers prefer to book smaller breaks to avoid upfront payments, and worse, 12% chose not to book at all, worrying about putting high one-time charges on credit.

In addition, hidden and unexpected costs were a major source of frustration as well. These include hidden airline charges (31% of respondents), additional costs at checkout (27%), and credit card fees (20%). A lack of flexible payment options was also an issue, with 17% reporting feeling annoyed about having to pay before they travel.

The option to pay for travel in installments would seem to encourage shoppers to go ahead and book. Staggered payments ease the financial burden when booking holidays, revealing that 31% of consumers would be more likely to buy travel if they had the option to spread the cost over time.
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