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02/01/2021

HTNG and HEDNA Produce Open Payments Alliance Standards Phase II Specification

Emily Wilson, Marketing Communications Specialist, HTNG
Marketing Communications Specialist, HTNG
Emily Wilson, Marketing Communications Specialist, HTNG profile picture

Hospitality Technology Next Generation (HTNG) and the Hotel Electronic Distribution Network Association (HEDNA) publish a comprehensive specification document and schema messages to standardize the way business to business (B2B) payments are processed today in the hospitality industry.

Addressing Payment Inefficiencies
With many advances and innovations in the distribution channel, payments have not evolved at the same pace as some other technologies due to their complexity. With many forms of payment used in the indirect sales channel, each one of them comes with different payment and processing instructions which ultimately lead to inefficiencies and overhead costs.

These inefficiencies may include technology that does not always support the transmission of payment data required for compliance and regulatory reasons, post-booking reservation changes, limited or non-existing technology to transmit payment instructions in the reservation and loss of revenue or anticipated profit due to manual and legacy processes and technology.

A 'Payment Manager Solution'
The Open Payments Alliance first defined the role of a ‘Payment Manager,’ a solution that transforms payable data into instructions to automatically initiate and settle payments between two parties. Next, the HTNG Open Payments Alliance Standards Workgroup was formed as a collaborative effort of HTNG and HEDNA members. The group designed a travel industry specific payment solution to allow travel companies to streamline payments between a Payment Manager and a hotel’s property management system and/or its central reservations system. These messages specify the terms for which payment for a given booking should be executed, and enable the flow of money into the intended recipient’s bank account.

Additionally, the Phase II Specification includes a set of messages between travel booking partners and the Payment Manager. The messages also support commission payments from a hotel to its booking partner. These solutions are expected to simplify and automate processing as well as accommodate payments used in indirect sales channels. The adoption of these specifications will standardize the way payments are processed today, improving operational efficiencies for hotels while providing a better check-in experience to travelers.

Alleviating Obstacles
“We are excited by the possibilities of what the Open Payments Alliance Standards will bring to the hospitality industry,” said HEDNA Board Member and XanderPay Founder and CEO, Mike Carlo. “The addition of a payment channel, parallel to the distribution channel, removes the bottleneck caused by legacy distribution processes needing to adopt changes to improve the way B2B payments are handled.”

Agreeing with Carlo’s thought, HTNG’s CEO Michael Blake adds, “The advanced concept of a payment channel will alleviate the obstacles the hospitality industry faces each and every day with B2B payments. HTNG is delighted to have collaborated with HEDNA on this valuable effort.”

The HTNG Open Payments Alliance Standards Workgroup included over 60 participants and was led by Co-chairs Xavier Ginesta, of Voxel Group and Dee Thomas of Onyx CenterSource. As a next step, the group will produce a webinar to demonstrate the work completed by this team within the upcoming month.

The Open Payments Alliance Standards Phase II Specification can be found here.