Travel Ledger is a new initiative which is aiming to oversee a new B2B industry standard for settling non-air financial payments, in the same way that IATA’s BSP has become the global standard for the airline industry.
It will be based on blockchain technology.
Travel Ledger founder Roberto Da Re said that blockchain is the enabler. “It is a technology which removes many of the reasons why there has not been a standard for non-air billing and settlements, particularly the cost.”
Travel Ledger is being positioned as a not-for-profit organisation, owned and managed by the travel industry.
Da Re is well known for having set up Dolphin Dynamics some 20 years ago. He has been working full-time on Travel Ledger since last autumn, giving up his day-to-day involvement with Dolphin’s core business in order to oversee its involvement in the new project from an independent perspective. Other businesses actively and equally involved in the development phase alongside Dolphin are UK-based Intuitive and Australia’s Tourism Technology.
Tourism Technology MD, Graeme Hunter, said Travel Ledger “will bring long overdue efficiencies to all parties and will create the backbone to make further use of blockchain technology” while Paul Nixon, MD of Intuitive talked in terms of “the innovative implementation of an emerging technology to solve a long-standing industry problem that impacts the entire supply chain.”
Da Re told tnooz that IATA, as a global regulatory body, had the power and funding to impose a set of standards on the airline industry. “There are some standards around non-air reservations, such as the Open Travel Alliance, but the complexity around the B2B payment flows has always been a problem trying to get everyone aligned,” he said.
By using the smart contract capabilities of Ethereum, Travel Ledger “will allow all billing records between B2B buyers and sellers of travel products to be stored in a shared, decentralised and authenticated ledger and will support settling or recording of payments in a secure and transparent manner”.
B2B payment providers will be able to work with the platform, which has no intention of replacing existing payment businesses. Da Re said he was looking to integrate bank payments, credit cards and others into the platform so that participants do not need to change their existing workflows. “Unlike BSP which collects funds from the airlines, our role will be to automate the process without ever actually touching the funds.”
The Travel Ledger Alliance is the business’ advisory board which will oversee the ongoing development of the platform once it has gone live. While the positioning is about not-for-profit, Travel Ledger will take a transaction fee from participants, which will contribute to ongoing development and running costs, overseen by the Travel Ledger Alliance.
Da Re said that there would be an opportunity for travel firms using the platform to also generate revenues by becoming a masternode – providing the computational power for the blockchain. “The majority” of the transaction fee, Da Re said, will be used to reward the masternodes for their contribution.
Travel Ledger is also planning a token sale, with the tokens used by participants to pay the transaction fee. In the initial phase of the project, participants will be offered tokens at a discounted rate in order to encourage travel firms to sign up. The cash raised from the token sale will feed into the development and ongoing costs.
Initially the focus for Travel Ledger will be businesses in the UK and Australia, but Da Re believes it has the potential to be global, again referencing the reach of IATA’s BSP. But he is aware that its ultimate success will be based around not only economies of scale but also mass participation.
He said: “The idea is that this is a standard the industry needs. And by making sure that the standard is hosted on a platform developed, owned and run by the travel industry for the travel industry means that there isn’t a third party investor creaming the profits.
“We think we have come up with a business model that incentivises everyone, and the more people who use it, the more benefits there will be.”