Research reveals travellers’ fintech preferences and Singapore’s wanderlust
According to the latest Outpayce research, travelers are projected to increase their spending on international trips by 28% over the next 12 months. Despite economic uncertainty, travel remains the top priority discretionary category among consumers worldwide.
The second edition of the ‘Consumer travel spend priorities’ research, conducted by Outpayce in collaboration with Opinium Research, surveyed 4,500 travelers from the US, UK, France, Germany, and Singapore during the second quarter of 2023. The findings show that travel holds a special place in the hearts of consumers, with 47% ranking it as a high priority for the coming year, a significant 12% increase compared to the previous year. On average, travellers anticipate spending $3,422 on international travel, marking a substantial rise of 28% from the previous year.
Jean-Christophe Lacour, SVP Global Head of Products Management and Delivery at Outpayce, remarked, “This year’s research shows that consumer demand for travel remains strong. People are clearly prepared to spend savings that may have been amassed during the pandemic, and to make sacrifices in other areas, to dedicate more funds to international travel.
But there’s no room for complacency.
Travel companies that prioritize transparent pricing in the traveler’s native currency, offer flexible payment options, and deliver a seamless retail experience stand the best chance of converting shoppers into paying customers.”
Moderation in demand for short-term credit
While travellers exhibit robust enthusiasm for travel, there has been a notable shift in their approach to financing. Last year, 75% of consumers expressed a preference for Buy Now Pay Later (BNPL) services to fund travel. However, the latest research reveals that this number has declined to 33%, indicating a moderation in demand for BNPL. This trend is mirrored across all forms of short-term credit, with significantly fewer consumers expressing interest in using credit cards or payday loans to fund their travel.
Instead, 40% of consumers plan to tap into their savings, while a third confirmed they will reallocate funds from areas like clothing and home improvement to finance their wanderlust.
Travellers value fintech and currency transparency
In the modern travel landscape, fintech plays a crucial role in shaping consumer preferences. Travellers increasingly value services that offer transparency and help them avoid foreign exchange (FX) fees while jet-setting. Notably, 66% of travelers are more likely to choose a travel company that allows them to pay in their own currency, representing an impressive 18% surge compared to last year. Additionally, 68% of respondents emphasised the importance of monitoring FX fees incurred during their travels.
Singaporean travellers also embrace fintech solutions to support their travel plans. 35% of respondents expressed a preference for Buy Now Pay Later services, while 36% are likely to take advantage of installment plans offered by travel providers. Moreover, 41% of Singaporean travelers are planning to use credit cards to supplement their travel expenses. 80% of travelers will pay attention and seek to minimise Foreign Exchange (FX) charges when booking trips over the next 12 months.
The report also revealed that Singaporean travelers will spend loyalty points, choose travel providers who allow customers to pay in their own currency, and use pre-paid debit cards that hold multiple currencies.
65% of respondents said they are more likely to choose a travel provider that allows them to pay in their own currency and is transparent about FX fees. 63% of travellers surveyed said they are more likely to use a pre-paid debit card that holds multiple currencies to limit FX charges. 59% of respondents said they are more likely to use a co-branded credit card to collect loyalty points that can be used towards travel.
Singapore’s travel enthusiasm, quantified
The research highlighted Singaporean travelers’ exceptional enthusiasm for exploration. Half of the travelers from Singapore intend to embark on more international trips than they did in 2019, surpassing the global average by an impressive 12 percentage points. Singaporean travellers aged 55 and above are projected to spend an average of $5,571.2 over the next year, significantly higher than the global average for the same demographic.
There was a wide variety of reasons for prioritising travel across respondents, including: the ability to travel to see family and friends (43%), pandemic savings granting the freedom the travel (40%), and the fact that the last few years have been tough, encouraging the desire for a break (35%).
As the travel industry experiences a resurgence, the research unveils a consistent and strong desire for travel experiences among consumers. The post-pandemic era has reignited travelers’ passions, making the outlook for the coming year remarkably positive. However, for travel providers to capitalize on this wave of enthusiasm, understanding fintech trends and preferences is crucial. Transparent pricing, cost savings, and a seamless digital experience will be the key differentiators in a competitive market. As consumers open their hearts and wallets to travel once more, the industry must embrace innovation and cater to the changing needs of the modern wanderer.
