Monday, April 27, 2020

Airlines, travel agents fight over lockdown ticket refunds intensifies

New Delhi: The tussle between airlines and travel agents has started to intensify. After the ministry of civil aviation circular on April 16 asking airlines to refund money to passengers, things have not moved in the direction as intended by the government. It seems both airlines and travel agents have been grossly violating the ministry directive. As per industry players, airlines have been refunding amounts to OTAs (online travel aggregators) in their "virtual wallets".
What are virtual wallets? Each travel agent is supposed to maintain such wallets with airlines to book tickets for customers. These wallets have to be topped up by agents to continue bookings.

Since the aviation ministry circular, domestic and international airlines have started refunding money to these wallets. But that's not helping agents, because these are not supposed to refund money back into accounts of travel agents. So even if they are refunded money by the airlines, there's no way agents can pass on refunds to customers (actual passengers).

It's estimated about Rs 180 crore of airline bookings took place (with just domestic carriers like IndiGo, Air India, Vistara, SpiceJet, AirAsia India, GoAir) after the lockdown started on March 25. The amount would be much larger if international bookings are added as some foreign carriers continue to take bookings despite complete ban on international flights in India till further notice.
"At the time of refunds, airlines doesn't give money to any agent in their bank account, they load refund amount in wallets which is maintained at their website. But post the DGCA directive, refunds are loaded in the same wallet which was used to book tickets. Our wallet balance with airlines will go up if the number of passengers opting for refunds increases, and agents' money would be blocked till the time we start getting fresh bookings. Till then, agents have to give refunds to customers from their cash flow or say no to refunds," says Nishant Pitti, the co-founder of OTA EaseMyTrip.
27/04/20 Manu Kaushik/Business Today

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