Blockchain to the rescue?

There are many pain points in the travel process, impacting consumers, suppliers, intermediaries and the tech providers. But there is a growing consensus that blockchain could be the innovation to address these issues.

NB This is a viewpoint by Trond Vidar Bjorøy, head of product development and implementation – Nordics at ATPI. The views expressed are the views and opinions of the author and do not reflect or represent the views of his employee.

Here are some specific problems and my observations on how blockchain might be able to help.


Blockchain could ease the continuous process that is PCI DSS compliance, at least for TMCs and other incumbents.

In a blockchain-enabled world, where cardholder data is no longer stored in traveller profiles hosted in corporate databases but belongs to the traveller and stored on the distributed network along with the booking transactions,  who does PCI apply for?

Traveller Profiles

When a company enters into an agreement with a TMC, airline or other supplier, it usually needs to give that supplier access to employee data for them to be able to provide the expected service. Whether that process is manual or automated via system integration between the two, building a well-functioning profiling process takes time and effort and creates friction on both sides.

If employees had their information on the blockchain, this would remove much of that pain on both sides. You would not have to build new API connections between the supplier’s profile database and the corporate’s system for every new implementation.

Manual profile workflows would be history. There would be no need for employees to create user accounts with multiple suppliers, duplicating their information along with thousands of other users with the risk of data breaches that comes with that.

Nor would they have to adopt every new supplier’s user interface. Just one unified profile available to those explicitly given access.


Among the more obvious and certain improvements we could see from the blockchain is the ability to move money faster.

Many fintech innovations will benefit the travel industry as well – the removal of middlemen and their fees, money transfers in real-time, instant settlement, streamlined and continuous auditing.

We should see the effects of this in all steps of the payment flows and between all involved parties, including the settlement processes specific to the travel industry.

Policy and compliance

The TMCs today have the role as the gatekeepers who drive compliance. Could the blockchain take over this responsibility?

Imagine the company travel manager receiving real-time alerts for policy breaches as they are about to happen. Whenever an employee is trying to book a trip outside the correct channel, a direct two-way communication channel is set up between the travel manager and the, knowingly or not, out-of-policy employee.

Or perhaps we will see a paradigm shift in managed travel and booking behaviour. Remember open booking? Perhaps the blockchain, with its potential for unmatched transparency, security and privacy, might finally be the enabler of this promised model for the future of managed travel?

Book where you want as long as it is within policy. Your travel data still gets collected, consolidated and made available to you, instantly.

Whether that stays the TMCs’ role remains to be seen.


Will we see a predominance of permissioned/private blockchains in our industry as the big incumbents try to evolve and maintain their power? We are already good at closed ecosystems so this could be the next natural step in that direction.

On the other hand, perhaps the very nature of the blockchain – the more open and public you keep it, the faster more nodes can connect to it, and the bigger, stronger and more secure your network gets – could actually be what this industry needs to really disrupt itself?

There are initiatives that seek to enable connectivity between different blockchains, building an internet of blockchains, so there is hope of seeing large-scale systems that open up for collaboration,  even if the industry should go down the route of private networks.

Smart contracts

What can so-called smart contracts do for the industry? If we look at a legal contract or a business agreement, they are basically the same as code –  a series of if-then-else statements built on “if you do this then I will agree to do that, if not I will do something else”.

An example (I have no idea if this scenario is rooted in reality or not but it serves the purpose):

Hotel A enters an agreement with TMC B with a clause saying that for the next six months, room nights booked more than 7 days in advance will give a higher commission than those booked later.

With today’s model, both parties would sign a contract.

When the period ends, both the TMC and hotel might have to run reports to identify the total number of qualified bookings from the TMC. Or they use some commission consolidation service to document it for them. Eventually, the correct commission amount gets paid out but this takes time and effort and there might be middlemen involved in the process as well, taking their piece of the pie.

With a smart contract, in a blockchain-enabled world, we could program the legal and business rules.

So we would set up a rule that says, if the upcoming stay booked through TMC B satisfies the seven days or more in advance clause, then .005 BTC would be transferred from Hotel A to TMC B at the point of booking.

In the blockchain-enabled world payments are direct and happening in real-time. And the only third-party possibly involved and entitled to a small transaction fee, would be a provider of the smart contract service.

There are obviously many benefits to this. Saved costs with the removal of intermediaries (lawyer, notary, broker etc), cutting hours off business processes and the trust achieved from storing your documents encrypted on a shared ledger.

For now it helps knowing how to code if you want to build smart contracts but there are visual editors that help write and deploy them for you and eventually tools will come that enable any business role to create contracts.


I am hoping, although not yet fully convinced, that blockchain will revolutionize the travel industry. While it is no panacea we are undoubtedly going to benefit from disruptive financial solutions that will extend across industries, but beyond that I feel there is a lot more insecurity.

The technology is entering “the trough of disillusionment” now and is  5-10 years for it to reach mass adoption. Travel is a bit behind that and we are probably at least a decade away from anything close to an industry-wide adoption of the blockchain, if it ever happens.

After all, we are talking about an industry where the fax is part of many business processes and where 40-year old tech dominates distribution.

However, one should not underestimate the fear of missing out, so if we just see a small percentage of companies beginning to move their services to the blockchain, this could see other players beginning to feel the pressure of the competition, and start moving themselves.

Hopefully, more people will start to add value when they see the true potential beginning to unleash. Blockchain does not have a killer-app yet but it could take just one to drive widespread adoption.

NB1: This is a viewpoint by Trond Vidar Bjorøy,  head of product development and implementation – Nordics at ATPI. The views expressed are the views and opinions of the author and do not reflect or represent the views of his employee.

It is an edited version of an article posted onto LinkedIn and is republished here with permission.

Click here to read the original article to full.

NB2: Image by Shutterstock.

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