By Ignacio González | Financial, Payments Management| Accelya

The outbreak of COVID-19 has brought unusual trends in a very short time period. Everything we have known has been turned upside down.

The circumstances have modified priorities for airlines, making cash flow management and revenue protection essential strategies to respond to the industry situation.

At Accelya, we have seen for the first time ever, the amount of refunds processed exceeding the number of charges. On the other hand, chargebacks have increased 800% between January and March this year compared to the same period in 2019.

How can the rise in chargebacks affect airlines?
This increase can put pressure on chargeback management teams, who may not be ready for such a scale of change.

But this is not the only factor to consider. In some cases both a refund and a chargeback take place in the same transaction. This is called double-dipping and has dramatically increased for airlines during month of March, adding up costs and creating an additional burden on cash flow.

What do you need to mitigate this impact?
Alignment: On average, 40% of chargeback claims are successfully defended. To minimize risk, your chargeback, refund and reconciliation teams need to work closely. You also need to consider expanding your team in a timely manner as it takes 3 to 4 months to train a chargeback specialist.

Adherence to deadlines: It is vital to have your teams ready so that your chargebacks can be defended within a set timeframe. Otherwise, you will lose the amount at stake and incur scheme and acquirer costs.

Comprehensive analysis: Your teams will need to use a detailed and highly granular data pool (a transaction level reconciliation of chargeback requests and refunds is required) to ensure that both refunds and chargebacks are not accepted in the same transaction.

What initiatives are airlines putting in place?
Revenue protection is a major challenge to the industry now. To learn how to address this, we have listened to our customers, who have been carrying out different practices during the last couple of weeks. Every airline has its own story, but overall, these are solutions we have seen working best:

Refund proposals: Some airlines are actively proposing refunds to avoid chargeback fees. If you follow this approach, ideally you would not proceed with the refund right away, but would need to also make sure to communicate it to the final customer, so the dispute is not triggered and so you can save the chargeback fee and administrative cost.

Presentment delay: To protect cash and to slow the rate of refunds hitting their respective acquirers, airlines have requested a set time delay between the date of the refund and the presentment to the acquirer. The delay goes anywhere from 30 to 45 days.

Unflown risk monitoring: Understanding unflown risk exposure helps predict cash flow and provides data that enables meaningful discussions with acquirers. According to our Webinar survey, 64% of the airlines do not review their unflown. Reviewing the unflown at this point is vital in refunds cancellations and chargebacks to free up as much cash as possible out of the collateral.

New acquirer set up: 46% of acquirers have changed settlement terms. We have seen airlines looking to open new acquiring connections for credit card billing, since existing agreements are frozen, or the terms of the agreement have trigger clauses that slow the release of cash.

Encouraging signs within the industry
It’s not all bad news. At the beginning of April, we have seen that credit card payments from our global pool of data have started to show an element of recovery.

Now that chargeback and payment dispute ratios have increased, the ability to ensure that only those that are valid are accepted becomes paramount for protecting cash.

According to our last Webinar survey, cash flow is a main priority for airlines, so we strongly recommend contemplating some of these initiatives to ensure its protection.

Source: Accelya

Airlines have an extraordinary need, now more than ever, to cut costs and to unlock cash as fast as possible. As a market leader in revenue leakage detection services, Accelya has partnered with IATA to present a new industry service, ADM Insight. ADM Insight is an IATA product powered by Accelya.

This solution gives airlines a worldwide consolidated view of all their uncollected ADM volumes, allowing them to have a global breakdown of the ADMs that require urgent action and conduct analysis and benchmarks for swift decision-making.

Considering the unique situation our airline customers are facing today, we have agreed with IATA to offer a free trial of this solution until June 30th. This tool helps airlines have greater visibility of common gaps and root causes and to understand the weak points and how to address them to prevent revenue leakage and improve cash flow.

Managing ADMs costs the airline industry $150 million a year and it is essential for airlines to clearly identify the issuance reasons. The ADM Insight solution enables airlines to benchmark performance and compare their own ADM recovery rate with those of the industry at large.

ADM Insight is aimed at helping airlines to prioritize critical blocked ADMs to be collected. The tool provides data through several KPIs (e.g. agent, country, form of payment and others) helping airlines make the right decisions more quickly through enhanced data visualization.

Source: Accelya

Cinq organismes voués au transport aérien international et au tourisme ont lancé un appel aux institutions financières internationales, aux partenaires de développement des pays et aux donateurs internationaux afin qu’ils soutiennent le secteur des voyages et du tourisme en Afrique, qui emploie quelque 24,6 millions de personnes sur le continent africain. Sans financement d’urgence, la crise de la COVID‑19 va provoquer un effondrement de cette industrie en Afrique, entraînant la perte de millions d’emplois. L’industrie apporte 169 milliards $ à l’économie africaine, ce qui représente 7,1 % du PIB du continent.

Cette demande est formulée par l’Association du transport aérien international (IATA), l’Organisation mondiale du tourisme (OMT) des Nations Unies, le Conseil mondial du voyage et du tourisme (WTTC), l’Association des compagnies aériennes africaine (AFRAA) et l’Association des compagnies aériennes d’Afrique australe (AASA).

Ces organisations unissent leurs voix pour demander aux institutions financières internationales, aux partenaires de développement des pays et aux donateurs internationaux de soutenir le secteur des voyages et du tourisme d’Afrique en cette période difficile par les moyens suivants :

• Aide financière de 10 milliards $ pour soutenir l’industrie des voyages et du tourisme et protéger les moyens de subsistance de ceux qui en dépendent directement et indirectement.
• Accès à autant de subventions et d’aide au financement que possible, pour injecter des liquidités et assurer un soutien ciblé aux pays gravement touchés.
• Mesures financières susceptibles de réduire les perturbations en matière de crédit et de liquidités au sein des entreprises. Cela comprend le report d’obligations financières existantes ou de remboursements de prêts.
• Mesures faisant en sorte que tous les fonds soient dirigés immédiatement vers les entreprises qui en ont besoin d’urgence, en allégeant autant que possible le processus de demande et en éliminant les obstacles normalement rencontrés dans le processus normal de prêt, comme la solvabilité.

Certains gouvernements d’Afrique tentent de fournir un soutien ciblé et temporaire aux secteurs très durement touchés comme le voyage et le tourisme. Toutefois, plusieurs pays n’ont pas les ressources nécessaires pour aider l’industrie à traverser la crise et soutenir ces moyens de subsistance.

La situation est devenue critique. Les compagnies aériennes, les hôtels, les gîtes, les chalets, les restaurants, les lieux de réunions et les entreprises connexes accumulent les pertes. Typiquement, le secteur des voyages et du tourisme est formé de 80 % de petites et moyennes entreprises (PME). Pour maintenir les liquidités, plusieurs d’entre elles ont déjà commencé à placer leur personnel en congé sans solde.

« L’impact de l’épidémie de COVID‑19 se fait sentir dans l’ensemble de la chaîne de valeur des voyages et du tourisme. Le secteur est particulièrement exposé, puisqu’il constitue le moyen de subsistance de millions de personnes dans le monde, en particulier dans les communautés vulnérables soutenues par cette industrie. Le soutien financier international est essentiel pour que l’industrie des voyages et du tourisme puisse diriger la reprise économique et sociale dans ces communautés », a déclaré Zurab Pololikashvili, secrétaire général de l’OMT.

Le directeur général et chef de la direction de l’IATA, Alexandre de Juniac, ajoute : « Les compagnies aériennes sont au cœur de la chaîne de valeur de l’industrie des voyages et du tourisme, qui crée des emplois de qualité pour 24,6 millions de personnes en Afrique. Leurs moyens de substance sont en jeu. L’endiguement de la pandémie est au sommet des priorités. Mais sans bouée de sauvetage pour maintenir en vie le secteur des voyages et du tourisme, la dévastation économique de la COVID‑19 pourrait faire reculer le développement de l’Afrique de dix ans ou plus. L’aide financière dès aujourd’hui est un investissement essentiel pour l’avenir de millions d’Africains après la pandémie. »

Gloria Guevara, présidente et directrice générale du WTTC, déclare : « Le secteur des voyages et du tourisme lutte pour sa survie, alors que la crise de la COVID‑19 a fait perdre plus de 100 millions d’emplois dans le monde, dont près de huit millions en Afrique seulement. L’industrie des voyages et du tourisme est la colonne vertébrale de plusieurs économies d’Afrique et son effondrement affecterait les moyens de substance de centaines de millions de personnes et créerait une énorme pression financière dans les années à venir. Maintenant, plus que jamais, il est essentiel que les gouvernements collaborent à une approche coordonnée à l’échelle mondiale en vue d’une rapide reprise et d’un soutien permanent à l’industrie des voyages et du tourisme. Il est essentiel que les communautés les plus vulnérables reçoivent de l’aide internationale. Il est primordial que la communauté internationale s’unisse de façon rapide et forte et intervienne par le truchement des institutions financières internationales, des partenaires de développement et des donateurs internationaux, pour offrir le soutien dont plusieurs millions de personnes de notre secteur dépendent lourdement pour leur subsistance. »

Abdérahmane Berthé, secrétaire général de l’AFRAA, ajoute : « Les industries du transport aérien et du tourisme sont parmi les plus touchées par la pandémie de COVID‑19. Le transport aérien est essentiel au développement économique et à l’intégration du continent africain. En ce sens, le soutien de l’industrie aérienne va faciliter une reprise économique plus rapide. La fin des activités des compagnies aériennes africaines engendrerait une série de conséquences financières sérieuses, et remplacer le service aérien fourni par ces compagnies serait difficile et coûteux. Des mesures urgentes, immédiates et cohérentes sont nécessaires pour la survie et la reprise de l’industrie. »

Le directeur général de l’AASA, Chris Zweigenthal, conclut : « L’impact de la COVID‑19 en Afrique demeure brutal. Les voyages aériens et le tourisme sont pratiquement arrêtés. Plus que jamais, les pays du monde doivent unir leurs efforts pour aider ces communautés parmi les plus vulnérables. La survie de notre industrie et des secteurs alliés a une portée considérable pour l’ensemble du système de transport aérien de l’Afrique. »

Five international air transport and tourism bodies have launched an appeal to international financial institutions, country development partners and international donors to support Africa’s Travel & Tourism sector which employs some 24.6 million people on the African continent. Without urgent funding, the COVID-19 crisis could see a collapse of the sector in Africa, taking with it millions of jobs. The sector contributes $169 billion to Africa’s economy combined, representing 7.1% of the continent’s GDP.

The request is being made by the International Air Transport Association (IATA), the UN World Tourism Organization (UNWTO), the World Travel & Tourism Council (WTTC), the African Airlines Association (AFRAA) and the Airlines Association of Southern Africa (AASA).

These organizations are jointly calling on international financial institutions, country development partners and international donors to support the African Travel & Tourism sector through these tough times by providing:

• $10 billion in relief to support the Travel & Tourism industry and help protect the livelihoods of those it supports directly and indirectly;
• Access to as much grant-type financing and cash flow assistance as possible to inject liquidity and provide targeted support to severely impacted countries;
• Financial measures that can help minimize disruptions to much-needed credit and liquidity for businesses. This includes the deferral of existing financial obligations or loan repayments; and,
• Ensuring that all funds flow down immediately to save the businesses that need them urgently, with minimal application processes and without impediment from normal lending considerations such as creditworthiness.

Some African governments are trying to provide targeted and temporary support for hard-hit sectors such as Travel & Tourism. However, many countries lack the necessary resources to help the industry and these livelihoods through this crisis.

The situation is now critical. Airlines, hotels, guesthouses, lodges, restaurants, meeting venues and related businesses face mounting losses. Typically, Travel & Tourism comprises 80% of small and medium enterprises (SMEs). To preserve cash, many have already begun laying off or placing staff on unpaid leave.

“The impact of the COVID-19 outbreak is being felt across the whole Travel & Tourism value chain. The sector is particularly exposed with millions of livelihoods across the world, especially within vulnerable communities, supported by the sector. International financial support is key to ensuring that Travel & Tourism can lead to wider economic and social recovery in these communities,” said UNWTO Secretary-General, Zurab Pololikashvili.

“Airlines are at the core of the Travel & Tourism value chain that has created quality jobs for 24.6 million people in Africa. Their livelihoods are at risk. Containing the pandemic is the top priority. But without a lifeline of funding to keep the Travel & Tourism sector alive, the economic devastation of COVID-19 could take Africa’s development back a decade or more. Financial relief today is a critical investment in Africa’s post-pandemic future for millions of Africans,” said IATA’s Director-General and CEO, Alexandre de Juniac.

“The Travel & Tourism sector is in a fight for survival, with over 100 million jobs losses globally and nearly eight million in Africa alone due to the COVID-19 crisis. Travel & Tourism is the backbone of many economies across Africa and its collapse will lead to hundreds of millions of livelihoods being impacted and enormous financial pressure for years to come. Now, more than ever, it is vital that governments work together on a global coordinated approach towards a swift recovery and ongoing support for Travel & Tourism. It is critical that the most vulnerable communities receive international help. The speed and strength with which the international community comes together and responds through international financial institutions, country development partners and international donors will be paramount to provide support to the many millions of people whose livelihoods are heavily dependent on our sector,” added Gloria Guevara, WTTC President & CEO.

“Air transport and tourism industries are among the worst impacted by the COVID-19 pandemic. Air transport is critical for the economic development and integration of the African continent. As such, support to the airline industry will aid in a faster economic recovery. An end of operations by African airlines would trigger a host of serious financial consequences, while replacing the air service provided by the airlines would be a challenging and costly process. Urgent, immediate and consistent measures need to be taken for the survival and rebound of the industry,” said AFRAA Secretary-General, Abdérahmane Berthé.

“The impact of COVID-19 in Africa continues to be brutal. Air travel and tourism have essentially shut down. Now, more than ever, international countries need to come together to help those communities that are most vulnerable. The survival of our industry and its allied sectors has serious ramifications for Africa’s entire air transport system,” said AASA CEO, Chris Zweigenthal.

Rolls-Royce is publishing, for free, its world-class digital skills training programme to help people and businesses around the world prepare for a potentially digital-centric recovery from COVID-19.

Bringing together its trusted training partners and platforms, the first suite of courses includes introductions to data science, artificial intelligence, machine learning, coding and digital culture. Courses range from ‘bitesize’ 20-minute sessions to extended fully certified training programmes.

This release by Rolls-Royce follows its founding role in establishing the global Emergent Alliance, a voluntary group of technology companies and data science specialists working together to find new ways to accelerate and smooth the path to economic recovery as the pandemic passes.

The Rolls-Royce Digital Academy has trained 20,000 of our employees in the last two years as it assists our transformation into one of the world’s leading industrial technology companies – and these are the training courses that are helping make that change happen.

Head of the Digital Academy at Rolls-Royce, Manisha Mistry, said: “Many people and businesses are experiencing incredibly tough circumstances and these free training packages are a tangible way for us to offer some help. Many have been tried and tested by Rolls-Royce employees. They can help people prepare for work and businesses transform ready for a digital future, just like we’ve been doing at Rolls-Royce for the last couple of years.

“Whether you’re 8, 18 or 80 years-old, these training packages will help you during this disruptive period of isolation: whether you need to keep your kids occupied, need new skills for a future job or just want to learn more digital skills in anticipation of the future.”

Supporting partners for this open learning programme, and the tools they are offering are:

• DataCamp – an opportunity to experience the top data science, artificial intelligence and machine learning courses used by Rolls-Royce employees
• edX – Rolls-Royce’s own CPD-accredited digital skills fundamentals programme containing six key courses including data awareness, the power of data and agile mindset.
• Google for Education – Google Applied Digital Skills helps teachers and students learn practical digital skills using the free project-based video curriculum. The ready-to-use video lessons teach digital skills that have immediate, real-life applications that provide students with the skills needed to succeed in the classroom and on the job, from researching to analysing data.
• IBM – Machine Learning for Kids: it will soon be normal for machine learning systems to drive our cars and help our doctors to diagnose and treat illnesses. This course provides hands-on experience in an easy-to-use guided learning environment to the people who will be programming the machines of the future.
• Learning Tree – Delivered by an award-winning industry leader, immerse in a suite of e-learning modules, white papers, skills assessments, live and recorded webinars on topics from agile to data analytics.
• TeenTech – For students 11-19 years, there are weekly insights into world-class organisations and the opportunities that lie within them. Each session will be themed and hosted by sponsors and industry experts with Rolls-Royce leading an Innovation at Home day on 18th May. Students can ask questions, develop their own solutions to global challenges and learn more about different careers.
• TechWeCan –free, easy to use and fun lesson plans for home schooling children (aged 10-13); children can learn about the opportunities a career in technology can offer; or join weekly Tech We Can Tuesday live lessons from 28th April at 10.30am; taking part in the City of Tomorrow challenge, where students apply their knowledge of science, technology, and engineering to create their City of Tomorrow where no ideas are too big, and everything is smarter, kinder, and safer than before.

People keen to learn will be able to access the courses from Friday 1 May through and https://www.rolls-royce.com/products-and-services/digital-academy.aspx

About Rolls-Royce Holdings plc

Rolls-Royce pioneers cutting-edge technologies that deliver clean, safe and competitive solutions to meet our planet’s vital power needs.

Rolls-Royce has customers in more than 150 countries, comprising more than 400 airlines and leasing customers, 160 armed forces, 70 navies, and more than 5,000 power and nuclear customers.

Annual underlying revenue was £15.3 billion in 2019, around half of which came from the provision of aftermarket services.

In 2019, Rolls-Royce invested £1.45 billion on research and development. We also support a global network of 29 University Technology Centres, which position Rolls-Royce engineers at the forefront of scientific research.

The Group has a strong commitment to apprentice and graduate recruitment and to further developing employee skills.