Credit card giant Visa International and NASDAQ-listed online travel service firm eLong announced they had teamed up yesterday, in an effort to tap the massive potential of China's e-travel sector.

According to a joint statement, the five-year alliance contract will help combine both companies' strong positions in the travel market and their expansive client lists in China.

The partnership with Visa will greatly facilitate e-shopping at eLong.com, while the Internet firm's online network of hotels, airlines and tourist destinations could expand the choices currently available to Visa card holders.

Visa International also provides an online security service to protect the interests of Internet shoppers. The service was launched on eLong yesterday.

"Security concerns are a major factor snagging the growth of e-shopping," said Albert Shiung, Visa International's vice-president and country manager for China.

"The security check service of 'Verified by Visa' is expected to boost e-shoppers' confidence when they purchase travel products online."

According to Justin Tang, chairman and CEO of eLong, the two companies also plan to launch co-branded credit cards, though he declined to offer a timetable for this.

The online travel sector is set to become the first port of call for customers looking to book air tickets and hotels, while e-purchasing services offer huge potential, according to Visa officials.

E-tickets, for example, are merely an option for travellers at the current stage, said Shiung. But Singapore Airlines has plans to replace all paper tickets with e-tickets after 2007 as online ticketing saves costs for carriers and customers' time. Moreover, more customer-friendly services are made available through e-ticketing.

If the move by Singapore Airlines opens the floodgates, e-ticketing is expected, sooner or later, to become the mainstay of the travel industry.

This change would bring about a strong demand for e-service companies, as well as increase the usage of credit cards.

China's younger generations have become major users of online services. The number of business travellers has also risen sharply, providing a new growth engine for travel service companies like eLong.

The cooperation between eLong and Visa also demonstrates the strong potential of e-shopping in China, according to both companies.

(China Daily March 4, 2005)