BSP is the central point through which data and funds flow between travel agents and airlines, and it is the subject of much debate at present.

Agents currently make a single payment to BSP remittance, covering sales on all BSP Airlines once a month in the UK.

But IATA’s requirement for agents to move to twice-monthly BSP remittance has triggered criticism from the industry. If approved, the new regime will be implemented in June 2016 in order to give a lead-in period which will allow agents to adjust their business plans accordingly. So why is IATA doing this and why should you care? Agents believe they are being penalised for airlines’ failure to institute effective safeguards against instances of agents’ sales suddenly increasing exponentially, as happened in the recent Airfast tickets failure which left debts of more than £45million. The new remittance regime will have a serious impact on the business of most IATA licensed agents. The proposed change would present agents with a considerable cash flow problem. As customers pay their bills to their agents on a monthly basis, agents will be forced to review their terms. Airlines tell agents that the solution is to transfer all credit accounts to card payment solutions. This means the card companies will end up providing credit to corporates in the same way as agents did, but what about the merchant fees? TMCs are being pushed further at every client contract renegotiation to lower their transaction costs and this makes it almost impossible to introduce the concept of paying two per cent more to use a credit card payment solution. It is feared the move may force some agents out of business. Many agencies will not receive more credit from their bank, so they either go bust or pay additional cost for borrowing or servicing by card. Each of these methods takes profit away from the agency which must be replaced, one way or the other. Watch this space.