Choice Hotels, which operates a franchise of 7,100 global locations, spends a lot of time managing transactions. A new system developed with TreviPay can reduce this friction by allowing the chain to integrate directly with employers of business travelers in the US.
Direct Pay enables companies to consolidate all their employees’ hotel stays into a single weekly invoice, so business travelers can check in and out without making a payment or submitting an expense report. It also slightly reduces the transaction costs of Choice Hotels by bundling many payments into one.
The move takes advantage of the acceleration caused by the embedded payments pandemic and the growing pressure on corporations to accelerate cash flow and reduce the risk of transaction fraud as business travel slowly recovers, according to Brandon Spear, CEO of TreviPay, which invented the solution with Choice Hotels.
“We wanted to make business-to-business payments look more like Uber by enrolling employers with Choice so that when employees come in and out, the payment is basically already on file,” Spear said.
Luke Sharrett/Bloomberg
The setup ensures that Choice Hotels franchisees are paid within 14 days via TreviPay – significantly speeding up accounts payable cycles at a time when cash flow is still tight for independent hoteliers waiting for business travel to fully recover. The system also reduces the risk of fraud associated with employees using personal or corporate cards for travel.
Global spending on business travel is recovering steadily, with 34% growth this year compared to last year. But corporate travel is not likely to reach pre-pandemic levels until 2026, when it is estimated to reach $1.4 trillion, according to the Global Business Travel Association.
U.S. hotel occupancy is at about 65%, with just under half of business travelers planning work-related trips in the next 12 months, according to STR, a Hendersonville-based travel data research firm. Tennessee.
“The direct salary guarantees us [franchise] owners make quick payment and enables them to spend less time manually invoicing, managing credit card authorization forms and tracking down payments,” said Chad Fletcher, vice president of global sales at Choice Hotels International. About 70 % of Choice Hotels properties are in the US
Choice Hotels’ direct payment shows how much room there is to further improve business-to-business payments, said Nathan Hilt, managing director with consulting firm Protiviti.
“The simple movement of digital payments that we’ve seen in recent years on the consumer side hasn’t happened yet in commercial payments, but I think we’re poised to see a lot more advancements like this soon,” Hilt said.
Choice Hotels, of Rockville, Maryland, broke ground for the product in 2018 when it launched a virtual payment system that enables corporate travel managers to guarantee employee hotel room reservations without requiring the traveler to provide a credit card. Choice expanded those group booking capabilities in 2019.
Working as an intermediary, TreviPay combines these capabilities that a company can access through a dashboard to download and manage its invoice data, track invoice status and resolve any fee conflicts.
Employees at participating companies can make reservations through the Choice website, mobile app or call center for any location their employer has authorized. During registration, employees show only a driver’s license or other ID. Employees can change the dates of existing bookings and employers can add notes, including project budgets and department codes, to further simplify the reconciliation process.
Choice announced its alliance with TreviPay in April. The first group of employers — whose names the companies did not disclose — are in the process of signing up, according to Spear.
TreviPay, a global business-to-business payment technology firm, formerly known as WMSM before rebranding last year, it sees opportunities to expand the direct payment concept to other travel companies and other business verticals, Spear said.
“Choice is the first nationwide company to pioneer this solution and it’s a great first use case,” said Spear.