The CAA has confirmed it “absolutely” intends to return to segregation of ‘pipeline’ customer money taken by agents on behalf of Atol holders.
Speaking on a Travel Weekly webcast, CAA head of Atol Michael Budge described pipeline money as “fundamentally part of the cashflow ecosystem” and said: “It’s fundamentally important. We want to ensure the industry is treated consistently.”
Budge explained the “only reason” the CAA’s most-recent document on Atol reform “signalled” it is not pursuing segregation of pipeline money at present is due to “sequencing the changes we’re making”.
He said: “We’re trying to find a way to reach a decision around reform, and then [see] how pipeline money fits into that.”
Budge confirmed protection of pipeline money would be approached through requirements in agency agreements, saying: “That is how we would expect it to manifest.”
However, Alan Bowen, advisor to the Association of Atol Companies (AAC), warned: “I’m not sure an operator is going to be aware what is going on no matter what is in an agency agreement.
“You can put anything you like in writing. Getting people to comply is a different matter. I’m not sure Atol holders have any control over it.
“Thomas Cook was collecting final balances a year in advance and tour operators only discovered at the end that their risks were bigger than they anticipated.
“Unless you have somebody watching there is no way of being certain what is happening.”
Bowen added: “It could be difficult for agents to have no cashflow because that is what this means.”
However, Budge suggested: “These types of challenges become much easier to manage with advancements in technology to identify where and when consumers are spending.
“The advancements we’re seeing, and the linkages with merchant services providers, provide ways to start to join these dots together.”
Budge argued: “It’s important we think about something that is developing and fit for the future, not based on how things have been in the past.”
The deadline for responding to the proposals in the CAA’s ‘Request for further information‘ on Atol Reform came on Friday, March 31.
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