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A file photo of a travel agent at the office.

K. Giriprakash

Bangalore, Oct 29

The airline industry could see another major upheaval from November 1 when all the airlines will stop paying any commission to the 3,000 travel agents across the country and instead make the agents charge a fee from the customers for every ticket sold.

From November 1, customers will have to pay a flat fee to the travel agents for each ticket they buy which will increase the total amount they pay for a ticket. Airlines till now pay five per cent commission to the travel agents for every ticket purchased by the customers.

Confirming the decision to stop paying commission to the travel agents, a top official with National Aviation Company of India Ltd (NACIL), which runs Air India told Business Line that his company will instead implement the transaction fee model (the fee charged to the customers for every transaction/ ticket) from November 1.

The airline has already sent letters to various agents last week informing them about its decision.

“In case the transaction fee model is implemented, at least 40 per cent of the travel agents will shut shop and lakhs of employees will be without jobs,” a travel agent on the condition of anonymity said.

Travel agents belonging to Travel Agents’ Association of India (TAAI) have already accepted the transaction fee model and had even hired Tata Consultancy Services earlier to recommend the fee structure which has now been accepted by the airlines.

However, another travel agents’ body, Travel Agents Federation of India (TAFI) has in a poll conducted among its members recently refused to accept the transaction fee model.

One of its members had even filed a case in the Calcutta High Court which had posted for hearing of the case on November 3.

As per the transaction fee model, customers will have to pay Rs 350 a economy class ticket and Rs 500 for every business class ticket.

For international travel, Rs 1,200 a ticket will be charged for the economy class ticket and Rs 2,000 for every business class ticket.

The airlines have agreed to let the fee reflect on the tickets but not as part of the main fare.

It will be collected by the airlines till December 31 this year and will be reimbursed to the agents subsequently. After December 31, agents will have to collect the fee directly from the customers. But NACIL has said that the fee will be reimbursed only if the travel agents sign an individual agreement with the airlines accepting the transaction fee model.

Travel agents claim that the role of the agents will change to that of consultants in case the transaction fee model is implemented. “If we start charging the transaction fee, we fear that we could be included as a party to any of the claims or damages raised by the customers,” the travel agent said.

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