The International Air Transport Association (IATA), which is the global representative body for the airline industry, has announced that it will offer the option of using digital currencies in its financial settlement systems. These systems are a service it provides to the aviation industry, and these now handle 74 different currencies.

“Digitalisation impacts many aspects of our daily lives, including the currency we use,” highlighted IATA senior VP financial settlement and distribution services Muhammad Albakri. “With the increasing use of digital currencies, it is imperative that IATA’s industry financial settlement systems adapt to support the needs of those using our services.”

IATA will launch this new era by offering the digital Renminbi. This will become usable in the China Billing and Settlement Plan (BSP) by the end of this year. (Coincidently or not, the Renminbi Offshore currency was the most recent to be added to the IATA Currency Clearance Service, which is IATA’s worldwide cash management system.)

“China is one of the most advanced countries in the world in the adoption of digital currency,” he explained. “Recognising the trend, IATA’s China Airline Committee requested for the digital Renminbi to be included in the BSP. This is an important development and IATA will accommodate the digital Renminbi by year-end.”

The association is now looking at offering other digital currencies in financial settlement systems. All decisions in this regard will be based on what the sector requires and needs.

“The experience gained in introducing the digital Renminbi will help IATA in onboarding other digital currencies in the future,” he pointed out. “At the heart of the integration of the digital Renminbi and all other settlement system work is a need to serve the customer and adapt to their behavioural changes in payment methods. Payment should be seamless. A customer shouldn’t be frustrated by not having their payment method of choice available. Nor should airlines lose out on deriving the proper value from their ticket sales.”