By The Nation
IATA Pay is an industry-supported initiative to develop a new payment option for consumers when purchasing a ticket directly from an airline website.
It is made possible by the European Commission's second Payment Services Directive (PSD2), and the UK's Open Banking regulation.
These regulations encourage use of so-called direct debit transactions in which payments are made from the customer's bank account directly into the bank account of the merchant. This method offers an extremely high level of security to both user and recipient and can be instantaneous.
IATA's role is to develop an industry solution enabling airlines to make this payment option available on their websites. The live test conducted with ipagoo was done under the UK's Open Banking framework with IATA Pay pilot airlines, including Cathay Pacific Airways, Scandinavian Airlines and Emirates.