Agents bat­tle with IATA

Travel Bulletin - - TECHNOLOGY -

Last month saw one of the most sig­nif­i­cant evo­lu­tions in the travel tech­nol­ogy land­scape in many years, with the adop­tion by the In­ter­na­tional Air Trans­port As­so­ci­a­tion (IATA) of new res­o­lu­tions which gov­ern the devel­op­ment of the New Gen­er­a­tion of IATA Set­tle­ment Sys­tems – also known as ‘New­gen ISS’. The IATA Billing and Set­tle­ment Plan (BSP) has formed the fi­nan­cial back­bone of the air trans­port in­dus­try for the last 45 years, and has suc­cess­fully fa­cil­i­tated the dis­tri­bu­tion and set­tle­ment of funds be­tween travel agents and air­lines – an amount worth over US$230 bil­lion last year. How­ever it now looks set for a makeover. Tech­nol­ogy providers will al­ready be work­ing on changes to their sys­tems to sup­port New­gen ISS, which in­cludes the in­tro­duc­tion of IATA Easy­pay – a vol­un­tary, pay-as-you-go e-wal­let pay­ment so­lu­tion for is­suance of air­line tick­ets. NEWGENISS in­cludes a range of new travel agent ac­cred­i­ta­tion mod­els, rather than the “one size fits all” sys­tem in­tro­duced in 1971, as well as Global De­fault In­sur­ance – an op­tional fi­nan­cial se­cu­rity al­ter­na­tive to bank guar­an­tees for travel agents. There’s also a con­tro­ver­sial new “risk man­age­ment frame­work” to mit­i­gate losses from travel agent de­fault in the BSP. Po­ten­tially this could see the im­ple­men­ta­tion of credit lim­its for agen­cies – a move which was staunchly op­posed at the re­cent IATA Pas­sen­ger Agency Con­fer­ence by AFTA CEO Jayson West­bury, in his role as out­go­ing chair­man of the World Travel Agents As­so­ci­a­tions Al­liance. West­bury pulled no punches, blast­ing some of the changes as “win­dow dress­ing that are not re­ally go­ing to pro­vide the in­dus­try with an ap­pro­pri­ate pro­gram that is fit for pur­pose”. Key is­sues in­clude the abil­ity for the sys­tem to sup­port “mod­ern pay­ment choices” – no­tably the use of vir­tual credit cards which are in many cases stymied by an IATA res­o­lu­tion which pro­hibits agents from pay­ing for tick­ets us­ing store credit cards. West­bury urged IATA to re­think el­e­ments of the pro­gram, point­ing out that many of the is­sues of po­ten­tial travel agent de­fault and credit lim­its would be much bet­ter solved by the more timely avail­abil­ity of sales data, which is of­ten de­layed by as much as 48 hours. “The key is real time sales re­port­ing into IATA, and in true part­ner­ship we all need to work to­gether with the GDS to make this a re­al­ity,” he told the con­fer­ence. He de­scribed the IATA plans for credit lim­its – also known as the Re­mit­tance Hold­ing Ca­pac­ity (RHC) - as po­ten­tially us­ing a “sledge ham­mer to kill a but­ter­fly”. He said while this might pos­si­bly help air­lines shut down an agent in the process of ab­scond­ing with their funds, it will def­i­nitely sig­nif­i­cantly pe­nalise an hon­est agent who is “sim­ply hav­ing a good week and is sell­ing well”. Fol­low­ing West­bury’s speech IATA is­sued a state­ment back­ing away from the RHC, say­ing a joint travel agent and air­line group had been estab­lished to de­fine a pro­posal by early next year, for pos­si­ble adop­tion at next year’s IATA pas­sen­ger con­fer­ence. “We are tak­ing a work­ing­to­gether ap­proach to this im­por­tant pil­lar of New­gen ISS in or­der to re­spond to travel agent re­quire­ments for flex­i­bil­ity, while cre­at­ing a struc­ture that en­ables safer sell­ing and greater pro­tec­tion of ticket funds,” said IATA se­nior vice pres­i­dent for fi­nan­cial and dis­tri­bu­tion ser­vices, Aleks Popovich. On other fronts IATA is also con­tin­u­ing to progress the devel­op­ment of its New Dis­tri­bu­tion Ca­pa­bil­ity (NDC) and at the IATA World Pass­sen­ger Sym­po­sium in Dubai last month un­veiled a busi­ness case de­vel­oped in part­ner­ship with SITA which pro­poses the global de­ploy­ment of Ra­dio Fre­quency Iden­ti­fi­ca­tion (RFID) tech­nol­ogy to ac­cu­rately track pas­sen­gers’ bag­gage in real time. The RFID sys­tem is es­ti­mated to be able to re­duce the num­ber of mis­han­dled bags glob­ally by up to 25% over the next seven years, sav­ing air­lines more than US$3 bil­lion.

The key is real time sales re­port­ing into IATA, and in true part­ner­ship we all need to work to­gether with the GDS to re­al­ity’ make this a

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