Air travelers purchasing tickets from
travel agents will no longer get long credit periods — something that used to
be the agents' USP over travel portals and airline websites where payments have
to be made instantly.
The International Air Transport Association (IATA) has decided to reduce the payment cycle of agents to airlines from the current fortnightly to a weekly basis from July 1. This means, agents will have to sell tickets for cash or ask for payment within a day or two.
While the move will help the financially-strapped airline industry, travel agents are clearly unhappy. "Agents will have to stop giving credit and need to collect cash for ticket sales in a maximum of two to three days. Small players who survived on credit facility will now go out of business.
The International Air Transport Association (IATA) has decided to reduce the payment cycle of agents to airlines from the current fortnightly to a weekly basis from July 1. This means, agents will have to sell tickets for cash or ask for payment within a day or two.
While the move will help the financially-strapped airline industry, travel agents are clearly unhappy. "Agents will have to stop giving credit and need to collect cash for ticket sales in a maximum of two to three days. Small players who survived on credit facility will now go out of business.
Credit facility may now be extended only to corporates and not to individual buyers.
At present, agents make payments of tickets sold from the 1st to the 15th of every month on the 30th day of that month. Under the new system, payments for tickets sold from the 1st to the 7th will have to be made on the 15th of the month and this cycle will repeat in the second fortnight of the month.
Agents are up in arms for one more reason. Indian carriers Jet and Air India are learnt to be reducing the 1% commission they pay to agents to zero. "In Sri Lanka and Nepal , agents get a 5% commission on ticket sales.
