The CAA believes there is “increasing understanding” of the needs of Atol holders among financial services providers, but Abta has contested whether this will mean sufficient and affordable financial protection under a reformed Atol scheme.
CAA head of Atol Michael Budge told a Travel Weekly webcast on Atol reform: “There is increasing understanding as trust accounts have become more common over the last couple of years.”
He acknowledged: “It’s building from a low base. Trust accounts are still not widely used. But knowledge within some merchant acquirers is building.
“There has also been a proliferation of FinTech businesses coming in acting as payment services providers, and we’re happy to engage with them. I’m not saying it’s perfect, but understanding is building.”
Budge said: “We have regular dialogue with payment services providers and have encouraged them to engage with us as part of this Atol reform process. We’re doing our best to engage them.”
However, Abta director of financial protection and membership Rachel Jordan warned: “I don’t know if the capacity is there.
“We’ve had 14 financial service providers in our financial-protection workshops – banks, insurers, merchant acquirers, bond providers.
“When I’ve said to them, are you looking to provide new products and services for travel businesses depending on what might come out of Atol reform, they say, ‘We can’t start to think about that until we know which way it’s going.’ That is potentially a big problem.”
Jordan argued: “It’s important to make sure the capacity is there if the CAA goes a particular way.”
She suggested: “The question for merchant acquirers, banks, insurers and bond providers is going to be how this impacts their risk assessment when providing terms to travel businesses.”
Budge argued: “There are a number of ways this [reform] could be put together. We’ve highlighted different options around how [customer] monies could be protected.
“We haven’t said bonding is out of the window. Bonding could sit there. Trust accounts could sit there. We’ve also talked about insurance. We see different components alongside each other.”
He added: “Cost is one of the criteria we’re considering. We’re asking, ‘are we considering the right factors? Are there different things we should take account of?’”
The CAA has pushed back the deadline for responses to its ‘Request for further information’ on Atol reform by a week to this Friday (March 31).
More: Special Report: CAA asserts case for change on Atol