South Asian Airlines are About to Launch Blockhain Payment

No South Asian flag carrier has switched on on-chain ticket payments yet, but the pieces are falling into place: Air India just adopted a blockchain-powered loyalty integration, regional neighbors like Emirates are moving to enable crypto checkout, and multiple OTAs already let you book South Asian carriers with crypto via payment processors. What’s missing is country-by-country compliance clarity and a conservative, low-risk rollout plan.

Why this is suddenly plausible

• Airline peers prove it’s feasible. airBaltic has accepted Bitcoin since 2014; Vueling integrated crypto checkout via BitPay/UATP—an airline-native payments rail. These are playbooks South Asian carriers can follow.
• Regional momentum. Emirates (a key hub for South Asian traffic) signed a preliminary deal to add crypto payments, raising customer expectations across the region.
• Workarounds already exist. You can pay with Bitcoin/USDT for Indian airline tickets through OTAs (e.g., Alternative Airlines) even though airlines themselves don’t yet natively accept crypto.
• Airline tech is adopting blockchain—starting with loyalty. Air India partnered with Loyyal (blockchain loyalty infrastructure) in June 2025—often the first step before exploring payments and settlement.

The latest concrete signals

• Air India x Loyyal (June 10, 2025). Air India announced a partnership to let Maharaja Club members earn points on everyday shopping through a blockchain-powered rewards network. This shows leadership buy-in, vendor due diligence, and real integration work with a blockchain stack.
• Emirates to enable crypto checkout. A July 2025 Reuters report confirmed a preliminary deal with Crypto.com to let customers pay through its service—important for anyone connecting through Dubai.
• OTAs accepting crypto for Indian carriers. Alternative Airlines accepts Bitcoin/altcoins via Crypto.com Pay, CoinGate, xMoney and others—covering itineraries on Air India, IndiGo, SpiceJet, Vistara, etc. This demonstrates demand and mature processor plumbing.

Reality check: As of August 18, 2025, the official payment pages for major Indian carriers (e.g., IndiGo, Air India) still list cards, net-banking, UPI, wallets, EMI—not crypto. That’s typical right before a controlled pilot.

Country-by-country regulatory snapshot (what airlines must align with)

• India: Crypto is not legal tender, but it’s taxed—30% on gains (Sec. 115BBH) and 1% TDS on transfers (Sec. 194S). Airlines would route crypto via a payment processor with instant fiat conversion to avoid custody/volatility and ensure reporting.
• Sri Lanka: The Central Bank warns that virtual currencies are largely unregulated and carry risks; any airline pilot would need strong AML/KYC controls and likely fiat-settlement via a licensed intermediary.
• Pakistan: The State Bank has repeatedly cautioned institutions and, per local reporting in May 2025, maintained a stance that crypto transactions are still illegal—making airline crypto checkout unlikely until policy changes.
• Bangladesh: A 2022 Bangladesh Bank circular directs all parties to refrain from virtual asset dealings; airline acceptance would not be permitted under the current framework.
• Nepal: Nepal Rastra Bank has public notices treating cryptocurrency activities as illegal, so carriers there are not candidates until reforms.

How a first South Asian rollout could work (low-risk architecture)

Phase 1: “Processor-only” pilot

• Accept BTC/ETH/USDC/USDT via a processor (e.g., BitPay, Crypto.com Pay, CoinGate) with instant fiat conversion (no crypto on the airline’s balance sheet).
• Limit to web checkout for O&D routes in India/Sri Lanka where compliance is manageable; exclude countries with prohibitions (Pakistan, Bangladesh, Nepal).
• Use airline-native rails like UATP for smoother back-office reconciliation and chargeback handling (mirroring Vueling’s model).

Phase 2: Ancillaries + loyalty

• Expand to baggage/seat fees and tie into blockchain loyalty so points earn/burn can be posted on-chain or through a blockchain middleware (e.g., Loyyal).

Phase 3: B2B settlement pilots

• Explore stablecoin settlement with selected travel partners (OTAs/GDS) for faster clearing—still fiat-settled on the airline ledger.

Compliance & risk checklist (what execs will ask for)

• KYC/AML: Processor must handle identity and Travel Rule where applicable.
• Tax ops: Automated reporting for India’s 1% TDS where relevant; clear mapping to Section 115BBH for gains (if any accrues to the airline—ideally none under instant conversion).
• FX & FEMA (India): Ensure crypto is treated as a payment method with immediate INR settlement by a domestic acquirer to avoid cross-border complications.
• Refunds/chargebacks: Define crypto-to-fiat refund logic (refund in fiat to original method or in voucher).
• Volatility: Use stablecoin rails or straight-to-fiat conversion; no treasury exposure.
• Data & security: PCI-DSS scope stays with processor; airline never touches wallet keys.

What changes for travelers

• Fewer foreign exchange fees and faster cross-border checkout (if processor supports your coin/wallet).
• Loyalty gets smarter. With blockchain loyalty, expect faster posting, partner earn/burn, and potentially tokenized perks linked to your wallet. Air India’s June 2025 move is an early example of this direction.

Likely early adopters in South Asia

• Indian full-service or hybrid carriers with strong loyalty economics and tech teams already trialing blockchain in non-payment contexts (e.g., Air India with Loyyal).
• Regional OTAs will continue bridging demand—useful market data for airlines to justify native support.

Frequently asked questions

Do any South Asian airlines accept crypto directly today?
Not officially on their own sites. However, you can already book South Asian carriers with crypto through third-party OTAs that integrate Crypto.com Pay, CoinGate, xMoney, etc.

Who’s the nearest big airline enabling crypto checkout?
Emirates—a key regional connector—signed a preliminary deal to enable crypto payments, which may launch before any South Asian carrier does.

Is crypto legal in India?
It’s taxed (30% gains; 1% TDS) but not legal tender. That’s why most airlines will use processors to convert to INR immediately and keep accounting simple.

What about Pakistan, Bangladesh, Nepal?
Current central-bank positions make airline crypto checkout unlikely there for now.