Holiday prices are expected to increase due to soaring fraud and moves to force credit card companies to take on greater financial protection.
The UK payment association APACS, which represents banks and building societies, has revealed Internet, telephone and mail order fraud in travel is up 45% this year compared to an overall increase of credit fraud of just 5%.
Operators and agents say the growth in fraud mirrors the increase in bookings made through these distribution channels and has been fuelled by the reduction in face-to-face fraud thanks to chip-and-pin technology.
Sunvil Holidays managing director Noel Josephides said: “The cost of fighting fraud is going to get worse. Companies selling product solely on the web will find it harder because costs will rise as they have to pay for greater security.”
Meanwhile, renewed speculation that the Civil Aviation Authority wants credit card companies to be the first port of call for customers wanting compensation has prompted criticism.
Josephides said any increased costs for credit card companies would be passed on to the trade, forcing prices up.
Olympic Holidays commercial director Photis Lambrianides said: “Credit card companies already regard the trade as a bit of a risk so the rates are already quite high.”
Lowcostbeds chief executive Paul Evans said: “Credit cards might protect your money but they won’t repatriate you if a company goes bust while you’re abroad. It is part of a bigger picture where the current regulations aren’t working.”
A CAA spokesman refused to comment.
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