Airline industry is also impacted by the digital revolution. Increasing demands, increasing fee revenues, solid earnings, and strong cost controls indicates a requirement for change. Due to this reason, most of the popular airlines are experimenting with advanced digital technologies like robotics, AI and advanced analytics.
Blockchain is one of the important technologies that seem to be a fertile place for innovation in this industry. It has the ability to manage, and distribute data as well as facilitate digital transactions. It promises resolve issues pertaining to trust, control, transparency and security in a complicated ecosystem.
Let us see more about the benefits of blockchain technology in aviation industry in detail.
What are the distinctive challenges faced by an airlines industry?
Some of the challenges faced by the airline industry include:
- Customers (corporate, cargo and individual)
- Partner airlines
- Offline and online travel agents
- Global distribution systems
- Industry associations like IATA
- Suppliers, service providers, and public authorities
- Travel industry players, like auto rental firms and hotels companies.
Blockchain has also seen the potential to enhance the customer experience and reduces cutting costs and increases operational efficiency. There are many companies that offer block chain services at affordable prices to business owners.
What is blockchain?
Blockchain services are linked with cryptocurrencies, like bitcoin. It offers a way to transfer money to anonymous users without any need of an intermediary. Blockchain is a form of a ledger that safely records financial transactions of a business across a wide network of participants.
Advantages of Blockchain in airline industry
Blockchain technology is effective in address existing problems in aviation industry. Some of the benefits offered by it in aviation indystry are as follows:
Quick and error free processing of payment
Blockchain technology assists airlines with automate and repetitive payments and processes. It has the capability to develop smart contracts and electronic agreements that can execute on its own as per the set of predefined rules.
Improved customer experience
Smart contracts by blockchain help in simplifying and automating the procedure among airlines, lowering the chances of error, and enhancing rate of customer satisfaction. Most of the applications are designed to improve and strengthen customer loyalty. A digital wallet enables customers to make use of frequent-flyer miles while participating at retail merchants.
The loyalty application enables members and partners to use rewards almost immediately, in real time basis. Blockchain application “STA” enables passengers to form tokens on their systems that would get accepted across borders and airports.
Simplify payment reconciliation and revenue accounting
When a ticket gets sold, airline firm needs to work with several players like travel agents, GDSs, and other airlines. It gives rise to complicated web of payments and revenues that has to be reconciled. Blockchain automates as well as streamlines settlement processes, ensures safe booking data, prevent disputes, and also prevent heavy reconciliation work.
Though blockchain technology is a recent introduction in the airline industry, airlines companies have started benefitting from it in enhancing their overall performance. It has seen a profound impact on customer-related activities, repair, overhaul, maintenance, ground operations, as well as revenue accounting.