UATP Books a Hotel As Its Airline-Card Network Diversifies

Processing volume hit some turbulence last year, but that didn't stop Universal Air Travel Plan Inc. from pursing its goal of adding merchants to its airline-owned network. Washington, D.C.-based UATP last week reported that LQ Management LLC's La Quinta Inns & Suites has become the first hotel chain in the network, where the UATP card is accepted by about 250 airlines. “Corporate-client demand for UATP acceptance at hotels drove this initiative,” UATP president and chief executive Ralph Kaiser said in a news release. More hotels are likely to be added, as are car-rental agencies, a UATP spokesperson tells Digital Transactions News by e-mail. “Yes, we are in the process of working with other chains and look forward to expanding the network,” the spokesperson says. UATP wouldn't identify any pending deals with either a hotel or car-rental company. UATP indicated about a year ago that it was working on bringing hotels into its network, which carriers developed to facilitate corporate air travel (Digital Transactions News, Feb. 17, 2009). Eleven domestic and foreign airlines issue UATP accounts and cards to corporate clients, in addition to processor AirPlus International on behalf of three. Asked about the time it took to bring a hotel on board, the spokesperson says, “Adding this new category required extensive testing. We wanted to be sure that the systems work as they were developed so that our corporate clients will enjoy the new developments.” AMR Corp.'s American Airlines, UATP's founder and a major issuer of UATP cards, along with Wal-Mart Stores Inc. played key roles in bringing Dallas-based La Quinta into UATP. In the release, an American Airlines executive said Wal-Mart approached the carrier about adding hotels to its UATP account. The UATP spokesperson says American issues UTAP accounts to Wal-Mart, which buys all of its global air travel over UATP. Now Wal-Mart, and other merchants, can get centrally billed hotel as well as airline charges through UATP. Dallas-based La Quinta has nearly 800 limited-service hotels in 46 states, Canada, and Mexico. Adding hotels gives corporations one more reason to use UATP cards, which cost network merchants less to accept than general-purpose credit cards. Besides working to add travel-related merchants, the network is bringing alternative payment systems to its clients, including PayPal Inc., Acculynk Inc., which specializes in processing Web-based PIN-debit payments, and several others. Those online networks could bring consumer-originated payments to the network. But after gaining altitude in 2007 and 2008, when UATP's processing volumes hit $10 billion and $12 billion, respectively, volumes plunged about 25% last year to $9 billion as the recession took its toll. “Corporate client travel was affected by the economy as most sectors were,” the spokesperson says. She adds, however, that, “We are already seeing double-digit improvement in 2010.” The spokesperson also says UATP's other services, which include various settlement services, training for airline personnel, and insurance products, did not suffer the declines that network payment processing did last year.