People are ready to get out of the house and see the world as vaccines are rolled out and restrictions are gradually lifted. According to a recent AirBnB survey, 54% of respondents said they have already booked, are currently planning to, or expect to travel in 2021.
Beyond the summer holiday rush, the prognosis looks good for steady growth in the off-peak season. As attitudes about working from home change, people have more flexibility to choose when and how they travel.
According to the Vrbo 2021 Trend report, 67% of travelers who took a "flexcation" in the past year said they would do it again. That creates obvious opportunities for longer-term home rentals.
However, as vacation rental platforms position themselves for growth, competition for hosts is intense. Squeezed for cash, hosts are favoring the platform that not only delivers the most bookings, but also provides the fastest, easiest payments.
To keep hosts happy, platforms need to get hosts paid faster. Here are three reasons why rental platforms need to consider new, faster payout options.
1. Differentiate your rental platform with faster payouts
In this transition period, host loyalty is low, so rental platforms need to differentiate by delivering a superior level of service — any way and every way they can.
Short-term rental hosts want more bookings, it's as simple as that. To maximize their exposure, hosts are increasingly listing their properties on multiple platforms.
According to the FAQ pages on the leading vacation rental platforms, host payouts are typically made within 24 hours after the guest’s scheduled check-in time. However, how long it takes for the payout to arrive in the host's account depends on the payout method.
It can currently take five to seven days before the money arrives in the host's bank account. While card providers are currently working hard to speed up payments, they are still a long way from delivering the instant satisfaction hosts want today.
2. Discourage hosts from adopting a direct listing strategy
Increasingly, rental platforms are not only competing against each other, but they also need to dissuade hosts from booking properties on their own direct listing websites.
The wave of cancellations in 2020 forced many hosts to rethink their reliance on rental listing sites.
According to vacation rental software provider Hostfully, up to 24% of rental property owners have prioritized a direct booking marketing strategy in response to the pandemic.
There is clearly a lot more complexity for the host with this approach. However one obvious benefit of skipping the middleman is that the host gains more control over their cash flow.
By speeding up the host payout, a rental platform can improve host loyalty. With the right payout method, payments may even reach hosts faster than they would on their own direct listing sites.
3. Reduce demands on customer service
Slow payouts drive impatient hosts to contact customer support. Every minute a support agent spends on host inquiries is a cost that could be avoided.
Often, the only answer is, "The payment has been sent, it just takes time for it to be processed." Not only has the agent's time been taken up, the host goes away unsatisfied.
Faster disbursement of payments will create a win-win for rental platforms. Hosts are happier and demands on service are reduced.
So how can vacation rental platforms speed up payouts?
With Trustly Online Banking Payments, not only can you get hosts paid faster, you can deliver instant payouts across Europe.
Trustly payouts are made via a simple API call. All the host has to do is share their bank account details with the rental platform upon registration, and then all payouts can be made without any further interaction.
Not only are Trustly payouts faster than cards or other alternative payment methods, Trustly also significantly lowers the cost of processing payouts compared to card payments.
As the popularity of Online Banking Payments (also referred to as Open Banking Payments) grows, more and more providers are popping up on the scene.
What's important to note is that the other players in the Open Banking scene can only initiate pay-ins to the rental platform, only Trustly can offer instant payouts across Europe. Our unique collection model and proprietary network of bank accounts enables instant payouts from a merchant's balance with no manual batch uploads.
We've put together a quick overview of how vacation rental platforms can leverage instant payouts to keep hosts happy. You can download your copy here.
Ready to learn more about what Trustly can do for your business? Get in touch with one of our travel industry specialists today.