United Airlines has terminated some travel agents’ right to process credit card transactions through United Air Lines merchant accounts. For travel agents selling United Airline tickets, the termination is a shockwave which will drive down profits and threaten business operations.
The termination will force the travel agents to absorb credit card processing merchant fees and shoulder the burden for potential chargebacks. That is, if the travel agent can even get its own travel agency merchant account or get an account with a volume high enough to accommodate ticket sales.
Travel agents also have to modify back office, mid-office, front office and consumer facing booking tools. Reprogramming all the systems is a big expense and takes time to do.
Travel agents usually access merchant services through the Airlines Reporting Corporation’s (ARC) Travel Agent Service Fee (TASF) program. However, this program processes service fees, not airline tickets. ARC has a $500 limit on transactions processed through the TASF program. Even agents with their own merchant accounts are at risk to lose their merchant status with a substantial increase in average transaction price.
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