Demand for travel now, pay later – a concept similar to ‘buy now, pay later’ (BNPL) – is growing among UAE travellers, especially to those travelling to long-haul and more expensive destinations.
During the long school summer break, many UAE residents travel abroad with their families to destinations with cooler weather.
Summer is a peak outbound travel season, so it’s no wonder that airfares to all the major tourist destinations across Western and Eastern Europe and the Far East are at an all-time high. This prompts many families in the country to opt for travel now, pay later options that are available through multiple platforms.
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In addition, some residents also opt for travel finance for vacations from local banks.
Currently, Abu Dhabi Islamic Bank, Ras Al Khaimah Bank (RAK Bank), Citibank and many others offer this initiative.
Similarly, local airlines have tied up with local banks which allow UAE residents to pay for their travel costs in instalments. This would allow them to travel during this summer and pay in instalments over the coming months. Some of them offer zero profit credit.
Tabby, a shopping and financial services app, said the average growth in sales for travel merchants is a massive 115 per cent over the past 12 months with an average order value for travel of $300 (Dh1,300).
Meerah Ketait, head of retail and leisure UAE at dnata Travel, said they’re “certainly seeing interest in flexible payment options, and actively promote this.
“These (flexible) payment options enable customers of our bank partners to pay with ease, and we often see this as a preferred option for customers booking longer stays or making bookings on behalf of a family or group of travellers,” said Ketait.
Dnata Travel has tied up with 12 local banks to offer Easy Payment Plans (EPPs) for UAE travellers.
“We have doubled our bank partner base in the last year, as this service continues to grow in popularity, to support our customers with various options,” Ketait added.
“Our objective with Easy Payment Plans is to provide our customers with the opportunity to travel, without having to outlay the cost in one transaction. We empower our customers with the choice of availing the plan relevant to them, or benefiting from our co-branded card with Emirates NBD, which not only offers the flexibility of easy payment plans but offers up to 15 per cent back on a customers’ purchase through dnata points – for additional savings on their next trip,” she said.
Avinash Adnani, managing director of Neo Travels and Tourism, said travel now, pay later is picking up big time in the travel industry as it also helps people in UAE to plan their vacations that suit their budget and finances.
He added that many people are opting for 10-15 days vacations and clubbing two or more destinations in their trip. By doing this, the cost for their travel also goes up, prompting them to use the BNPL option.
“Many people can’t afford to pay Dh10,000 in one go, but they can afford to pay Dh2,500 in four instalments. So this option of ‘buy now, pay later,’ is truly advantageous for travellers. This also allows people to add more destinations. For example, someone planning to Georgia, also adds West European destinations by adding a few thousand dirhams more and they can repay in instalments,” said Adnani.