New Delhi: Around 123 travel agents in India have either voluntarily surrendered their International Air Transport Association (Iata) accreditations or saw them terminated in 2008, reporting the highest number of withdrawals from India in the last five years. Industry experts attribute this to cost-cutting measures by agents and airlines in the wake of global economic recession.
Based in Montreal, Canada, Iata works with airlines and accredits some 60,000 travel agents worldwide. In India there are now about 2,900 Iata accredited agents. The Iata accreditation fee varies across countries. In India, the fee for a new applicant is $550 (Rs26,895) and an annual fee of $90 for existing members.
According to the Iata website, 60,000 travel agents worldwide sell around $220 billion worth of airline tickets on behalf of around 230 member airlines. In the Asia-Pacific region, the number of accredited agents increased from 9,600 in 2006 to 11,800 in 2008, while in India they increased from 2,400 to 2,900 in 2008 over the same period.
“The number of agents in India that did not get their accreditation renewed—either voluntarily or were terminated—was 52, 70 and 123 in 2006, 2007 and 2008, respectively. Though 123 from India is the highest in the last five years, one must bear in mind that the number of travel agents in India obtaining accreditation has also increased. In 2008, about 200 agents obtained accreditation in India,” said Singapore-based Iata spokesperson Albert Tjoeng in an email response.
Industry experts, however, say because of the recession, airlines have stopped paying accredited agents credit against the sale of air tickets, because of which these agents were defaulting.
“Every Iata agent has to give a bank guarantee varying from Rs10 lakh to Rs1 crore. In the last 6-12 months, around nine travel agents have defaulted and have been deleted from the Iata list. Around 23 leading Iata agents have surrendered their licences voluntarily and are closing down their branches to maintain one location,” said Subhash Goyal, chairman, STIC Travel Group Pvt. Ltd. According to Goyal, there are over 20,000 non-Iata agents in India.
“Being an Iata agent had opened up numerous business avenues for us and we have seen a 50% drop in our annual business after our Iata licence was terminated,” said J.S. Walia, managing director of Indore-based Frequent Travels and Cargo Pvt. Ltd, one of the nine defaulters.
The Iata agency accreditation is voluntary but offers an agent many benefits such as access to a global network of accredited airlines and travel agencies, standardized procedures to ensure fair dealings with airlines, and visibility and credibility on premises and websites among others. An Iata accreditation also enables an agent to get a commission from all Iata airlines, hotels and transporters.