Travelport develops blockchain for hotel commission reconciliation

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Travelport and IBM are currently working in partnership with industry stakeholders to evolve the solution into an active pilot program. Photo credit: peshkov/iStockPhoto

Travelport has developed a blockchain solution to enhance the hotel commission reconciliation process. Working with IBM Services and travel-management company BCD Travel as well as a number of hotel chains, the blockchain technology solution aims to optimize hotel commission processing on a distributed ledger by managing reconciliation, tracking and accounting for commission payments owed from hotel chains for services purchased by travelers via booking agencies.

By creating an accurate and shared view of the booking status and commissions, all parties stand to win, according to Travelport.

 Blockchain technology behaves like an online ledger with the ability to collect data, build upon that data in real-time, and then independently and securely report information to any number of parties based on permission. Following an IBM Garage engagement, Travelport and IBM Services, together with partner BCD Travel, developed a solution using distributed ledger technology to streamline commission reconciliation between BCD and three high profile hotel chains. 

Hotel commission reconciliation processes include a range of challenges from the operational lack of audit trails driving escalations and manual data mapping to the financial impairment of revenue forecasting and the more commercial impact on commission flexibility and duty of care. Solving for this current friction is critical to ensure all stakeholders in a hotel transaction are duly compensated and ultimately to ensure customers receive an optimal travel experience. Travelport and IBM are working in partnership with industry stakeholders to evolve the solution into an active pilot program.

“Blockchain technology applied to commission reconciliation has the potential to deliver real [return on investment] to both a travel agency and the hotel,” Ross Vinograd, Travelport’s senior product director, said in a statement. “Traveler modifications at property, no shows and complimentary roomnights are just a few examples that drive commission discrepancies, which in turn generate escalations, cost and revenue loss. Our aim is to put the life cycle of a booking on the blockchain and we believe doing so will drive transparency, trust, and ultimately booking volume.”