Civil aviation secretary K N Srivastava’s order on the transaction fee allowing differential pricing might increase ticket sales through airline websites. This will also help airlines reduce sales and distribution expenses.
According to the order, airlines can offer different fares for those who purchase tickets on its website and those booking from agents. This implies passengers buying tickets from agents will have to pay a slightly higher fare, which includes commission or transaction fee. Differential pricing would encourage people to book tickets from airline websites, according to industry sources.
About 80 per cent of airline tickets sold in India are through travel agents and online portals. The rest is sold through airline websites and booking offices. At present, there is hardly any difference between the fares on airline’s website, online portals and global distribution systems used by agents to book tickets.
“Earlier we were airline agents, now we are becoming their (airlines’) competitors,” said a travel agent. A few months ago, Jet Airways agreed in principle to allow agents to use credit cards to book tickets and restore price parity in tickets sold on their website and reservation systems used by agents. But the airline gave no commitment to restore five per cent commission. “Airlines have been taking an anti-agent stance and want to sell to passengers directly. The agents may start charging higher fees for visa processing and other services if they lose business due to differential airfares,” said another agent. In the order issued last week, the civil aviation secretary ruled that the meaning of transaction fee, commission or convenience fee was the same — payment of remuneration to an intermediary.
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