IATA launches EasyPay to ease cash flow of airlines

The International Air Transport Association (IATA) has rolled out a new payment model for travel agents, which aims to ease cash flows for airlines.

Currently, travel agents in India receive seven-day credit to pay airlines for ticket bookings under the IATA's billing and settlement plan. Agents are required to furnish a bank guarantee to avail credit. Under the EasyPay scheme announced on Monday, agents would be able to make payments using a debit card. IATA has tied up with YES Bank to implement the scheme.

The EasyPay is a component of new generation settlement system (NewGen ISS) launched by IATA which represents over 250 airlines around the world.

EasyPay is voluntary payment model and agents can continue to avail seven-day credit under the existing process. However, agents may have to furnish bank guarantee of a higher amount to avail credit as IATA has reworked some of its policies governing the agents' accreditation.

"Digitisation of payments will increase cash flows into the airline industry for both companies and IATA agents in India with fund realisation turn-around improvement by 9-10 days. With this partnership YES Bank is targeting an annual throughput of ~200 billion in due course," YES Bank said. An expert, however, said that scheme could remain a non-starter unless agents were offered better deals and discounts by airlines while selling tickets under EasyPay scheme.