Cargo Chat: PayCargo speaks on technology in cargo communities

[caption id="attachment_76918" align="alignright" width="216"] Lionel van der Walt, Americas president and CEO, PayCargo[/caption] Logistics payment platform PayCargo made headlines recently for its collaboration with Atlanta’s Hartsfield-Jackson Airport (ATL) and IT solutions provider Kale Logistics to establish an air cargo community system at ATL. Whether the announcement from ATL foreshadows more widespread adoption in the U.S. of the air cargo community system, which has formerly been more popular in Europe, remains to be seen. Air cargo communities are lauded as increasing visibility and cooperation between cargo stakeholders at airports, but have been slow to take off in the U.S. However, increasing adoption and streamlining of technology platforms among major airlines is better positioning air cargo players for collaboration. To learn more about the outlook for digitalization and air cargo community adoption in the U.S., Air Cargo World sat down with Lionel van der Walt, PayCargo’s president and CEO for the Americas. ACW: How has the introduction of online payment processes changed the industry so far? LvdW: If you look at the process prior to online payment systems — specifically pertaining to import and storage fees — previously in the U.S. the majority of these fees were paid by check or vouchers. If you look at the process, a shipment comes into the country by way of an airline; the forwarder then has to be notified that it’s arrived in the country; reconcile that within their systems; write out a check; and get a courier to rush a check to the airline to get the shipment released. The airline then has to match the check in their systems to the shipment and then authorize their warehouse or airport staff to release the cargo. When you adopt an online technology, many of these steps become redundant, saving costs and time. The forwarder accesses an online payment portal where they either enter the amount to be paid or it is already pre-populated as the result of an integration with the airline’s system. Usually there is a second separate forwarder approval step after which a notification is sent to the airline that the payment has been approved by the forwarder. Based on a commitment they have with us, many of our partners release the cargo immediately once they receive this payment authorization message as they are assured their funds the next day via our system. ACW: What are the obstacles keeping people from adopting this technology? LvdW: From what I’ve seen, the biggest obstacle are the many legacy systems still in place, with some of our partners using multiple legacy systems. If you go into a typical airline, you will find — if you’re lucky — two or three systems, up to 10, 15 or 20 standalone or partially connected systems in some cases. So, if you plan to adopt a technology like PayCargo, how do you get it to seamlessly fit in with all of these technologies? It is encouraging to note that many airlines are running significant projects to upgrade, streamline and integrate their internal systems. This will certainly help with the adoption of new technologies such as ours. ACW: One of the more recent developments for PayCargo is your involvement in the creation of the airport community in Atlanta. How did that come about? LvdW: In my previous roles, I had the opportunity to deal with the Atlanta Airport (ATL) team. I saw an article in the press announcing the collaboration between Schiphol Airport (AMS) and ATL … AMS has been involved in the air cargo community space for some time, and PayCargo had already been in discussions with the Air Cargo Netherlands community. I reached out to the ATL team as we saw that there was a great opportunity for collaboration to include our payment technology; they had everything in the technology sphere [through Kale Logistics] except for the payment capability. The value-add was clear and hence the partnership that has developed from there. Now if you asked me, strategically, where this is heading, I’m a huge supporter of air cargo communities. If you look at what’s happening in Europe right now, many of the airports have established cargo communities; Brussels, AMS, etc. And what’s happening is, they’re starting to talk to each other and connect. So, you’ve got various communities with all these stakeholders that are connecting, which I think is going to drive a level of standardization eventually, that will hopefully lead to seamless data flows and information sharing that should result in the industry becoming more efficient. In the U.S., we are way behind. I hear from a lot of people, “You know, that’s Europe, but this is the U.S. — it’s different. Our market is different, things are done differently.” I think it’s a bit of an excuse, and I think that with ATL leading the way, others will follow; more and more airports are seeing the benefits of and considering the establishment of such communities. Right now, Miami International Airport (MIA) is busy reviewing its options and hosting user workshops and I suspect airports such as DFW will follow suit soon. I see constrained airports such as Los Angeles (LAX) benefiting from such communities, so await to see if they will consider this approach to address some of their local challenges.

Cargo Chat: PayCargo speaks on technology in cargo communities

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