Airline payments: 2025 in review

I joined Worldpay in 2025 after two decades in the airline industry. That experience gave me a unique perspective on the intricate mechanics of airline payment operations.

From the expansion of instalment payment options to airlines launching their own digital wallets, 2025 brought both exciting progress and lessons about where payment innovation for airlines is heading.

Flexible payments democratise air travel

One tangible shift was the growing availability of buy now, pay later. By late 2024, BNPL had gained significant traction, with at least 31 airlines offering Uplift and major carriers like United, Emirates and Southwest offering integrated instalment options. In 2025, though, it truly went mainstream.

The appeal is straightforward. High ticket prices can be a genuine barrier to booking, particularly for leisure travellers. BNPL removes this obstacle while transferring credit risk to specialist providers that pay airlines upfront. The commercial logic is sound: Airlines capture bookings they might otherwise lose, avoid chargebacks and reach markets with lower credit-card penetration. In Latin America, for instance, instalment payments are a cultural expectation.

Recently, innovative partnerships have more deeply integrated BNPL with airlines – for example partnerships between UATP and Klarna, and more recently between UATP and Affirm. This signals that BNPL for airlines has followed retail in becoming important and even expected payments infrastructure. Airlines offering these programs responsibly, with transparent terms and interest-free options, may find they can expand their customer base without assuming additional credit risk.

Airlines as fintechs

Perhaps the boldest development of 2025 was seeing airlines move into financial services. Turkish Airlines launched TKPAY in late 2025 under a central bank payment licence, creating a fully-fledged digital wallet that handles multicurrency accounts, QR code payments and even converts loyalty miles into cash.

This is not simply a loyalty program with stored value. TKPAY positions Turkish Airlines as a payments provider, competing in the broader financial technology space while potentially deepening customer loyalty. If successful, this signals genuine demand for airline-branded financial products, particularly when combined with generous cashback promotions.

Other carriers in APAC pursued similar paths, using digital wallets to retain refund credits, facilitate future bookings and reduce payment-processing costs by keeping transactions functionally in-house. The strategic calculus is compelling: capture more customer spending, generate revenue through interchange or merchant commissions and gather customer data beyond flight bookings.

The question is whether most airlines have the regulatory appetite, technical capability and risk tolerance to become licensed financial institutions. For those that do, the payoff could be substantial.

Refunds and compensation: From grudging to instant

Building on the U.S. Department of Transportation’s 2024 mandate for automatic cash refunds within seven business days for cancelled flights, 2025 saw airlines racing to implement real-time payout technologies.

Solutions using Visa Direct and Mastercard Send enabled airlines to push funds instantly to passengers’ cards, turning service recovery into a potential loyalty moment.

Some carriers replaced vouchers with prepaid debit cards, loaded with exact compensation amounts and issued by cashless kiosks at airports. The operational benefits include no cash handling, faster resolution and valuable data on how passengers spend disruption compensation.

Agentic commerce: Myth or reality?

The most hyped development in booking is agentic AI, which allows travellers to book and pay for flights conversationally using artificial intelligence. Our research indicated 73% of global consumers are open to letting AI agents browse for and purchase on their behalf.

While expecting AI agents to handle complex booking decisions in the near term is premature, this doesn’t mean airlines should ignore agentic commerce. The technology will evolve, and carriers must ensure their inventory is accessible via APIs, that their payment systems support tokenised transactions, and they participate in emerging standards.

Looking ahead

The payment innovations of 2025 are structural shifts that may demand a strategic response.

Payments have moved from being a cost center to a strategic lever for growth, customer loyalty and efficiency. Airlines that treat payment innovation as a priority can capture new customers, reduce processing costs and build stronger relationships with travellers. Carriers that have embraced these changes may find themselves well-positioned to compete in 2026 – while those relying on outdated payment infrastructure may find it harder to keep pace.

Ajish Morris is a senior strategy manager for airlines at Worldpay and has over two decades of experience at full-service and low-cost airlines in the Asia-Pacific region. He also teaches at Singapore University of Social Sciences, where he leads undergraduate tracks in aviation management, airline marketing, and airline operations and planning.