Consumers consider travel their highest priority when it comes to discretionary spend, a new report finds.
According to an Amadeus study, which surveyed 4,500 consumers from France, Germany, the United Kingdom, the United States and Singapore, international travel is highest on consumers’ spending list, with 42% of respondents ranking it their top priority in their coming year.
Despite economic uncertainty, consumers, on average, estimate they will spend $2,670 on international travel over the next 12 months, in line with what they spend on average in 2019 ($2,780).
Many travelers also say they plan to spread the cost across installments, reducing exposure to costly foreign exchange (FX) transactions and by dipping into loyalty points.
Subscribe to our newsletter below
Travelers are adopting fintech, as well, to reduce the expense of paying internationally and to add an element of flexibility to funding trips.
Three-quarters of respondents (75%) say they are more likely to choose a pay-by-installment option such as buy now pay later to fund travel over the coming year, compared to 44% who are more likely to use a credit card and 26% who are more likely to turn to payday loans.
Consumers are also embracing new fintech options, with 48% saying they are more likely to try pre-paid debit cards that hold multiple currencies and 49% saying they are now interested in co-branded cards that yield loyalty points.
“The demand for flexible payment options like buy now pay later in travel is extraordinarily high. The industry is eager to meet this demand, but it should do so responsibly, with thorough risk management in place,” says David Doctor, executive vice president of payments at Amadeus.