Nepal’s first online travel aggregator XcelTrip wants to ‘disrupt’ the tourism industryNepali travellers can pay for hotels and flight tickets using e-SEWA, debit and credit cards issued by local banks while foreigners can use their international cards.
The travel and tourism industry is one of the largest industries with a reported global direct and indirect economic transactions of over $7.6 trillion in 2016. And the industry sees hundreds of thousands of new startups entering the arena and compete with already existing big names.
A week ago, XcelTrip, an online travel platform which boasts 1.5 million hotels and 400 airlines in its business ecosystem, launched its Nepali subsidiary, XcelTrip Nepal which has been announced as the official online travel partner in the ambitious Visit Nepal 2020 campaign.
“Since travel trade is the largest business in the world, there is a huge opportunity and I decided to initiate the travel start-up back in 2016 with the hope of total disruption to solve the real issue faced by hoteliers and consumers,” said Gyanendra Khadka, chief executive officer of XcelTrip.
When asked about what disruption meant, Khadka says that only a handful of online travel platforms are dominating the travel market and control a large base of 70 percent of transactions and his company aims to intervene and disintermediate middleman culture to directly connect hoteliers and customers.
The company is setting its sights at offering zero percent commission, unlike major travel aggregator which it says are charging hotels and customers up to 30 percent of the travel fees, making tours more expensive.
The company’s revenue model is based on charging service fees, which resembles just another name for commission. Nonetheless, it is expected that it will add some economic contribution as an on-shore travel aggregator.
According to Khadka, unlike other travel platforms, whatever money XcelTrip charges as service fees will stay in Nepal, helping the economy to retain hard currency.
As a startup in Nepal, the company is having difficulty integrating domestic hotels in its platform as hoteliers are sceptical about the profits that the company can secure through its online platform.
In a bid to gain traction from hoteliers and customers alike, the travel aggregator has offered a free listing of Nepal based hotels and resorts in its ecosystem and launched an independent marketing partner programme, a referral technique where people can recommend and get hotels on-board to earn from bookings received by hotels listed by them.
To further expand its reach, the company has joined hands with E-Sewa, Nepal’s largest digital wallet with more than 2 million users and 60 thousand vendors, as its e-commerce partner.
“We are facing a lot of challenges to integrating the hotels just because we are new,” said Khadka. “It will take a few years of experience and growth to fully stabilise the market. Building the relationship and trust with vendors and payment settlement are some of the major challenges that we are facing due to a lack of regulation and service offered by the banks.”
The company which boasts a large base of customers in 14 countries has entered Nepal at a time when the government is gearing up to launch it ambitious Visit Nepal 2020 campaign with the target to bring in 2 million tourists in a year.
According to the company, XcelTrip being the first online travel aggregator of Nepal officially recognised by the Nepal Tourism Board has given the company exposure and was even featured in Forbes, CNBC, Entrepreneur. INC Magazine and more.
“I started XcelTrip with a concept to decentralise the travel space by offering cheaper travel services across the globe. XcelTrip Nepal also makes it easy for Nepali travellers going abroad by allowing them to pay in local currency using e-SEWA and debit and credit cards issued by banks of Nepal,” said Khadka. “XcelTrip Nepal also allows international travellers to book hotels and flights in Nepal using their international cards.”
According to Khadka, he moved to Silicon Valley in 2014 and started investing in new startups and as he was working on different projects, XcelTrip became the one big idea.