The recent collapse of Tempo Holidays has shown that while the AFTA Chargeback Scheme (ACS) is not perfect, it is the best protection travel agents have against supplier collapse and more members should be embracing it, AFTA Chief Executive Jayson Westbury told delegates at this year’s Travellers Choice Conference.
Following the demise of Tempo Holidays, “a whole heap of agents, including some in this room, were out of pocket”, he said. But agents who were part of ACS – a non-profit, member-owned Mutual Fund that provides protection against credit and debit card chargebacks – lodged a claim, were reimbursed for any loss and then “moved on”.
Under the old Travel Compensation Fund, Westbury said no agent would have been protected agents against credit card chargebacks. However, he acknowledged the Fund would have compensated customers who had paid by cash or direct debit.
“The TCF was only half pregnant, it only protected the cash. We have flipped it on its head. Through ACS we effectively protect you against credit card chargebacks.
“If the customer paid by cash, it is still a nightmare at the moment, and I am well aware of the criticism that we’ve just tipped the pregnancy on its head and now we are only half pregnant on the other side. That’s a reasonable criticism. But finding a solution is not easy.”
The problem, Westbury said, was that “someone has to pay”. And no simple solution – such as the additional 0.25% credit card surcharge that funds ACS – is currently available. Nevertheless, he assured members that the AFTA Board was exploring ways to resolve the cash-payment issue.
In the meantime, he urged travel agents to protect their businesses against chargeback as a result of supplier insolvency by adopting ACS. He directed Travellers Choice member agents to the group’s TC Pay range of payment solutions which includes CardPay, an ACS Payment Partner.