NewGen ISS · Then Travel Agent collects the funds on ... DISH Data Interchange Specifications...

NewGen ISS Travel Agent Readiness Guide

February 2018

Version 1.0

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CONTENT

The end-to-end process ................................................................................................................ 12

Airlines participating to IATA EasyPay ................................................................................... 16

Accreditation Models .................................................................................................................... 19

Remittance Holding Capacity (RHC) ...................................................................................... 21

Global Default Insurance (GDI) .............................................................................................. 25

Strategy .......................................................................................................................................... 26

Periodical billing reports .............................................................................................................. 31

BSPlink IEP Online Billing Reports ........................................................................................ 34

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GLOSSARY

Acronym Meaning

ACM Agent Credit Memo

ADM Agent Debit Memo

BSP Billing Settlement Plan

BSP Cash

BSP CA

Customer pays with any form of payment. Then Travel Agent collects the funds on behalf of

the Airline and settles to an IATA bank account as per remittance calendar in the specific

BSP

BSP Card

BSP Credit

Card

BSP CC

Credit Card of the of the customer is used to purchase a ticket on the merchant of the

Airline

BSPlink Internet-based system which facilitates interactions and exchanges of information between

all participants in the BSP

CA Cash

CC Credit Card

CC FOP Credit Card Form of Payment

DISH Data Interchange Specifications Handbook

DPC Data Processing Centre

EP Code IATA EasyPay Code

EP FOP IATA EasyPay Form of Payment

eWallet Electronic wallet / digital wallet to be used online, where users can store, send and receive

funds

FOP Form of Payment

FOP EP / CC IATA EasyPay Form of Payment / CC Form of Payment

GDI Global Default Insurance

GDS Global Distribution Services

HOT Hand Off Tape = Airline Accounting / Sales Data

IATA International Air Transport Association

IEP IATA EasyPay

ISS IATA Settlement Systems

NewGen ISS New Generation of IATA Settlement Systems

PAConf Passenger Agency Conference

Pay-as-you-go Refers to IATA EasyPay solution which funds must be available at the time of ticket issuance

PSG Passenger Agency Conference Steering Group

RET file Reporting file between GDS and DPC

RHC Remittance Holding Capacity

SCU Standard Charging Unit

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OBJECTIVE OF THE DOCUMENT

The NewGen ISS (New Generation of IATA Settlement Systems) Agent Readiness Guide aims to support

the approximately 40,000 Accredited Travel Agents using the BSP globally in preparing for the

introduction of NewGen ISS. The goal is to facilitate this process for Travel Agents to begin using it

within their organization and simplify the effort required from Travel Agents to gather information.

This manual will be regularly updated with the latest information and best practices learned throughout

the course of the NewGen ISS deployment.

Please note this guide focuses mainly on IATA EasyPay (IEP), one out of four pillars of NewGen ISS. This

guide should be used by each Travel Agent with care and diligence, taking into consideration its own

situation and market conditions.

GENERAL STRUCTURE OF THIS DOCUMENT

This guide consists of two main sections:

The first section provides an overview of NewGen ISS.

The second section covers the introduction of IATA EasyPay.

SUPPORT INFORMATION

For further information regarding NewGen ISS, please visit:

https://newgeniss.iata.org/

The latest version of the Travel Agent Readiness Guide will available on the site.

https://newgeniss.iata.org/

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NEWGEN ISS PROGRAM

NewGen ISS aims at transforming the current ISS business model which facilitates the distribution and

settlement of funds between Travel Agents and Airlines (indirect sales).

Since its launch in 1971, the Billing and Settlement Plan (BSP) has successfully facilitated the distribution

and settlement of funds between Travel Agents and Airlines safely and securely. However, many of the

rules governing the BSP were established in an era of paper ticket stock, brick-and-mortar Travel Agents,

limited payment methods and a highly regulated Airline industry. These rules no longer address the

diverse and complex needs and risks of Airlines and Travel Agents today.

IATA Settlement Systems are the financial back office of the air transport industry. Since its introduction,

the BSP has successfully facilitated the distribution and settlement of funds between Travel Agents and

Airlines, which totaled around $220 billion in 2016. But the one-size-fits-all model launched in 1971 no

longer fits today’s vastly different operating environment. NewGen ISS will ensure that IATA’s Passenger

Agency Program continues to deliver value to Travel Agents and Airlines by providing new options,

greater flexibility and promoting safer selling.

NewGen ISS is a strategic program aimed at transforming the current BSP system into the modern world

by delivering simplified processes, lower costs, increased funds protection, new payment methods and a

choice of Travel Agent Accreditation Models.

With the introduction of NewGen ISS, IATA will provide an enhanced customer support to better address

the needs of Airlines and Travel Agents. The program is composed of four interconnected pillars:

IATA EasyPay, which introduces a new, secure payment method based on a pay-as-you-go

model for tickets issued through the BSP.

New Agency Accreditation Models that better fit a Travel Agents’ needs and business models.

Safer selling, through the implementation of a monetary threshold for Travel Agents’

outstanding monies at risk known as Remittance Holding Capacity.

Global Default Insurance that offers Travel Agents a new and optional financial security solution

to what is already available in the market.

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WHY IS IATA INTRODUCING NEWGEN ISS?

NewGen ISS is focused on maintaining the long-term relevance of the BSP while the distribution

landscape is evolving rapidly. Travel Agents and Airlines increasingly come in range of shapes, sizes and

business models. Similarly, new distribution and payment channels have emerged outside the traditional

BSP channel. In order to ensure that the BSP meets the needs of Travel Agents and Airlines, the BSP

needs to adapt to this changing environment. Under NewGen ISS, IATA is moving away from a one-size

fits all approach and towards greater segmentation with new Accreditation Models, more targeted risk

management based on a Travel Agent’s risk profile, and new ways of doing business in the BSP through

the introduction of IATA EasyPay.

Regardless of a Travel Agent’s risk status or past sales history, today there is no maximum amount of

monies at risk that a Travel Agent may have outstanding to the BSP at a given moment in time, e.g. no

maximum risk exposure. NewGen ISS is also tackling this flaw in the current risk management

framework, as it has resulted in a number of multi-million dollar defaults in past years. To address the

risk, NewGen ISS will establish an individualized threshold for each Travel Agent’s maximum outstanding

cash funds held in trust pending remittance to the BSP (e.g. Remittance Holding Capacity or RHC). If a

Travel Agent reaches this maximum capacity then Cash as a form of payment will be restricted until a

remittance is made and the Travel Agent again falls below its RHC. Measures will be in place to facilitate

the introduction of an RHC and allow continued selling, but this measure is an important step to

promote safer selling and protect the integrity of the system for legitimate Travel Agents.

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BENEFITS OF NEWGEN ISS

Travel Agent Benefits Airline Benefits

IATA EasyPay (IEP)

Reduction of Financial Securities

New funding alternatives

Access to more accreditation options

and ability to sell upon reaching the

RHC

Cash flow acceleration

Increased collection of funds

Bespoke payment strategy

GoLite

Accreditation Model

Easier financial requirements

Entry point into the BSP

Wider distribution network without

increased financial risk

GoStandard

Accreditation Model

Increased flexibility moving away from

the on/off ticketing environment of

today

Safer selling for Cash sales, the most cost

effective payment method for Airlines

GoGlobal

Accreditation Model

Simplified processes & operational

efficiencies

Cost Savings (consolidated global

financial statements rather than local

financial statements)

Smarter Risk Management of the entire

Travel Agent group

Visibility on Multi-Country Travel Agent

sales activity

Remittance Holding

Capacity (RHC)

A more secure selling environment for

all participants

Reduced pressure on Local Financial

Criteria

Limited risk exposure and a reduction of

default losses

Global Default Insurance (GDI)

Additional choice of Financial Security

Cost savings

Flexibility to easily adjust Remittance

Holding Capacity

Certainty of claims

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IATA EASY PAY (IEP)

The introduction of a new pay-as-you-go solution for tickets issued via the IATA BSP is one of the pillars

of the NewGen ISS program. This new solution consists of a private, closed-loop and proprietary travel

industry B2B payment method for IATA Accredited Travel Agents to issue Airline tickets through the BSP.

IATA EasyPay (IEP) is based on an electronic wallet (e-wallet) model1, therefore, it is a secure payment

whereby funds are secured at the time of ticket issuance (e.g. a Travel Agent can only use IEP as a form

of payment if the Travel Agent holds sufficient funds in its IEP account prior to ticket issuance).

IEP is additional and does not replace any of the existing forms of payment. IATA EasyPay is distinct from

BSP Cash and BSP Credit Card in the reporting and has its specific rules, cash flow calendar and cost.

1 Subject to local regulations and capabilities.

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IATA EASYPAY AS AN ENABLER OF NEWGEN ISS

The introduction of IEP is the key enabler to facilitate the implementation of the new Travel Agent

Accreditation Models. IEP will be an available payment option for all Accreditation Models, but will be

specifically important for Travel Agents under GoLite as those Travel Agents will not have access to Cash.

In addition, once a Travel Agent with access to Cash sales reaches its RHC, Cash sales will be restricted.

The Travel Agent will be able to continue issuing tickets via IEP or other alternatives other than Cash.

Please refer to section 2.7.2. Remittance Holding Capacity (RHC) for more information.

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IATA EASYPAY BENEFITS FOR TRAVEL AGENTS

IATA EasyPay will bring several benefits for Travel Agents as IATA EasyPay is entirely voluntary to use

and they will have the flexibility to fund their IATA EasyPay account through different payment methods,

subject to local availability. For those Travel Agents required to provide a Financial Security, it will

enable them to lower the amount of security provided. It will also give new Travel Agents access to the

GoLite Accreditation Model. Furthermore, it will allow Travel Agents to continue selling if they reach

their Remittance Holding Capacity.

Access to new Accreditation ModelsIATA EasyPay is an enabler for the introduction of new Accreditation Models. Specifically, it allows for the introduction of the GoLite, a lighter option which will make the BSP more accessible.

Reduced Financial SecuritiesAs a secure form of payment, IATA EasyPay transactions will not be part of a Travel Agent’s cash sales at risk. This will offer an Agent a means to lower their Financial Security amounts with IATA.

VoluntaryIATA EasyPay payment method will be available to all IATA Accredited Travel Agents who will be able to use it on a voluntary basis.

Payment alternativesIATA EasyPay is additional; it does not replace any of the existing payment methods.

Funding alternatives availableIATA EasyPay accounts may be funded through different alternatives. Bank transfers will be available in all BSPs, however, additional options like credit/debit card may be available in a BSP.

EasyEasy to use and easy to reconcile. A unique IEP number per authorization (this could either be a single ticket or a booking, e.g. multiple tickets) provides Travel Agents with a simple process to reconcile tickets.

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HOW DOES IATA EASYPAY WORK?

The end-to-end process

This section has been structured following the end to end process for IATA EasyPay sales. The process an

IEP transaction follows and its different components is detailed in the following steps, from IEP account

opening to Reporting:

A) IEP Account Opening

A Travel Agent will open an IATA EasyPay account online through the IATA Customer Portal

(please refer to Annex A or B – IEP Portal Guide for further details on how to open an IEP

account).

Once the IEP account has been opened the Travel Agent user will be able to perform other

actions such as fund the IEP account, add other users, withdraw funds, etc.

B) IEP Account Funding

A Travel Agent may fund its IEP account with different payment methods depending on the IATA

EasyPay capabilities available in the BSP (bank transfer, credit/debit card or other forms of

payments).

Once the IEP account has been funded, the Travel Agent will be able to use those monies to

issue a ticket corresponding to, at least, the value of the transaction or withdraw the remaining

balance to its bank account.

Please refer to Annex A or B - IEP Portal Guide for further details on how to add a bank account,

fund an IEP account and withdraw funds.

IEP ACCOUNT OPENING

IEP NUMBER GENERATION

• The Travel Agentfunds its account from its financial source.

• Travel Agent requests an IEP number on its IEP account.

• IATA transfers daily EasyPayamounts to each Airline.

• Funds expected to reach the Airlines within 48 to 96 hours following ticket issuance.

TICKET ISSUANCE

SETTLEMENTIEP ACCOUNT FUNDING

• A Travel Agent opens an IEP account through the IEP Customer Portal.

• Travel Agent will issue a ticket through the GDS using CC FOP by entering the IEP number.

REPORTING

• IEP transactions will be highlighted on the periodic billing reports.

• The Travel Agent may consult its IEP daily activity on the IEP Customer Portal.

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C) IEP Number Generation

Before ticket issuance, the Travel Agent will need to generate the IEP number to use in the GDS.

Please note the following:

IEP number will be based on a payment scheme network, e.g. Mastercard or UATP.

IEP number will be dynamic number (single use).

IEP number follows Primary Account Numbers (including Luhn check) structure as per

ISO 7812 standard.

IEP Authorization messaging structure follows ISO 8583 standard.

Please refer to Annex A or B - IEP Portal Guide for further details on generating the IEP number.

D) Ticket Issuance

The Travel Agent will then be able to issue a ticket through any GDS by entering the IEP number,

using and selecting the form of payment CC followed by the vendor code (CA or TP). At the

time of issuance, the authorization request approval will secure the funds for payment of the

transaction. If the Travel Agent has sufficient funds, funds are instantly blocked in the IEP

account and the Travel Agent’s available balance is reduced by the amount of the transaction,

the authorization request is approved and the ticket can be issued (even when the ticket is for

multiple bookings). On the other hand, if the Travel Agent does not have sufficient funds in the

IEP account, the authorization request is denied and the ticket is not issued. For any tickets

issued with IEP, no chargebacks are accepted.

Example of ticket issuance process:

IEP number obtained by the Travel Agent through the IEP account:

5164704444444333 and expire date 02/25.

Travel Agent selects form of payment CC in the GDS.

Depending on the BSP, the IEP numbers will be provided by Mastercard or UATP.

In this specific example, Mastercard is the provider of the IEP number.

o The Travel Agent will select CCCA FOP in the GDS.

o Travel Agent inserts IEP number in the GDS booking system:

CCCA51647044444443330225

o In case of an UATP number, CCTP would be used.

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Please note the following:

Authorizations messages coming outside the GDS environments will be rejected.

Net Reporting Schemes can be used with IATA EasyPay: The amount corresponding to

IEP is the one to be used for the Authorization.

Multiple FOP scenarios including IEP are available: Issue, exchange or reissue

(combination of IEP with other DISH forms of payment allowed).

Void an IEP transaction: Tickets issued with IATA EasyPay as the form of payment can be

voided within the same day as any other tickets. If the Travel Agent’s GDS offers

Reversed Authorization Messaging, then the authorization code securing a specific

amount in the IATA EasyPay e-wallet will also be cancelled within the same day.

Otherwise, the authorization code will expire within a set number of days. Please refer

to Annex C – Transactions Handbook for further details on void an IEP transaction.

IEP Exchanges: Subject to all applicable ticketing / fare rules, tickets issued with IATA

EasyPay as the form of payment can be exchanged or re-issued, the same as

transactions issued with other forms of payment. Please refer to Annex C – Transactions

Handbook for further details on exchanging an IEP transaction (ticket).

Refunds: Form of payment on the refund is the same as the one on the issue

transaction. Therefore, tickets can be refunded on IATA EasyPay only if they have been

issued, exchanged or reissued using IATA EasyPay as FOP.

A refund can be submitted either by the Travel Agent through the GDS automated

refund functionality or through the BSPlink Refund Application, as shown in Annex C –

Transactions Handbook.

When processing a refund, the Travel Agent must use the same IEP number as on the

original ticket. The refund will be processed and credited back to the Travel Agent’s IEP

account. If the wrong IEP number is entered, IATA’s Data Processing Centre (DPC) will

reject the transaction at the time of processing.

Automated GDS refunds of IEP transactions will be credited to the Travel Agent’s IEP

account following the same processing cycles as IEP ticket sales. For Refund Applications

processed via BSPlink, timelines will be subject to the carrier’s authorization of the

Refund Application.

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In case an extra payment takes place due to an exchange ticket and the Travel Agent has

paid an amount above the previous fixed price, the Travel Agent does not have to

request the extra payment to be refunded, IATA will issue a credit note to deduct the

extra amount from a future billing period. In case the Travel Agent does request the

extra amount to be refunded, IATA will refund the money.

Commissions: Any applicable commission will be transferred to (issues) or from

(refunds) the Travel Agents as part of the standard Remittance & Settlement process. It

should be noted that any applicable commission amounts due to the Travel Agent (for

IEP sales) or from the Travel Agent (for IEP refunds) will be processed like commissions

on BSP Card (CC) transactions, and netted from the Travel Agent’s remittance amount.

Fare and tax amounts: IATA EasyPay transaction totals are excluded from the Travel

Agent’s remittance amount due to the BSP, as funds are secured at the time of ticket

issuance and transferred directly from the IEP system to the BSP (similar to CC

transactions).

Withdrawals: The Travel Agent is allowed to withdraw funds from its IEP account as long

as the amount is not blocked for a ticket issuance. Please refer to Annex – A or B IEP

Portal Guide for further details on how to withdraw funds from the IEP account.

E) Settlement

IEP amounts are settled daily by IATA via the BSP to each Airline’s bank account (like Cash

settlements). Airlines can expect to receive IEP amounts within 48 to 96 hours following ticket

issuance.

F) Reporting

IATA Data Processing Centre (DPC) receives the file containing all IEP transactions from the GDS,

produces the periodic billing report where the IEP transactions are highlighted with the EP form

of payment.

Please refer to Annex D – IEP Report Samples for further details.

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Airlines participating to IATA EasyPay

Airlines are automatically opted-in to accept IEP by default once IEP is available in any specific BSP, with

the possibility to opt-out on a BSP per BSP basis. If an Airline has opted out from IEP, IATA Customer

Service will send a one-off notification regarding that decision within the BSP that Airlines operates in.

Also, upon request, IATA Customer Service Portal will be available to inform Travel Agents about Airlines

payment methods.

A Travel Agent is responsible to not issue tickets through an Airline that has opted-out. Currently the

GDSs cannot restrict a Travel Agent to issue tickets on that Airline using IEP. Once the full

implementation of IATA EasyPay is performed by the GDSs, IATA will be able to restrict opted-out

Airlines on GDS level, preventing any unwanted tickets to be issued.

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ADM/ACM ISSUANCE

Airlines participating in IATA EasyPay can issue Agent Debit Memo (ADM)/Agent Credit Memo (ACM) for

documents issued using IATA EasyPay transactions, just as they would for documents issued using any

other form of payment. The ADM/ACM issued will be included in the Travel Agent’s billing reports as a

cash amount due and must be remitted by the Travel Agent to IATA through the BSP remittance process:

In case of ADM, Travel Agents will remit the amount due in accordance with the BSP reporting

calendar (independently from IATA EasyPay).

In case of ACM and subsequent negative remittance, IATA will credit the amount to the Travel

Agent’s bank account (different from IATA EasyPay).

Travel Agents under the new Accreditation Model GoLite:

Will be providing their bank account details as part of their accreditation process.

Will have access to BSPlink and would be obliged to check their periodical billing reports.

Will be liable to remit corresponding amount owing for ADMs to the BSP in accordance with the

applicable BSP remittance calendar. Failure to remit ADM amounts will be grounds to default

the Travel Agent.

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THE COST OF IATA EASYPAY

For Travel Agents, there is no cost for using IATA EasyPay. Thus, opening and maintaining an IEP account

is free of charge, and having it will allow Travel Agents to have another payment method available to

issue tickets when they reach the RHC, when they are accredited under GoLite Model or on a voluntary

basis.

Airlines will bear the cost of IEP as they currently pay the cost of BSP CA and BSP CC sales. Please note

that Airlines will hold themselves responsible for managing their business models that fit best their

individual commercial strategy, therefore they are entitled to decide whether bear that cost, transfer it

to Travel Agents or give incentives for Travel Agents to use. IATA is in no position to interfere in Airlines

business decisions. This commercial policy needs to be decided individually by the carrier BSP by BSP

before starting the process of implementing IEP.

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IATA EASYPAY LINK TO THE OTHER NEWGEN ISS PILLARS

Accreditation Models

In order to bring Travel Agents greater choice and flexibility and address their today’s different concerns

and risks, NewGen ISS is introducing a range of Accreditation Models. By moving away from the current

“one-size-fits-all” approach, the New Accreditation Models can better fit Travel Agent needs, while

enabling a smarter, targeted risk management.

Travel Agents will be able to choose from the following three models of accreditation as well as to

convert across models as their businesses evolve.

GoLite: It is an entry-level accreditation to facilitate participation in the BSP. Many Travel Agents

today, especially in emerging markets, cannot become accredited due to the financial

requirements and underlying costs associated to accreditation, e.g. Financial Securities. Airlines

that wish to do business with these Travel Agents must do so outside the BSP.

Under this new Accreditation model, Travel Agents are only able to issue transactions in the BSP

using IATA EasyPay or the customer’s debit / credit card as the forms of payment. Since Travel

Agents do not have access to BSP Cash as a form of payment, there is limited financial risk.

Accordingly, the applicable financial requirements are minimal. However, chargeback insurance

or alternative security is required to cover risk associated to credit card sales.

The benefit of this Accreditation Model is that it lowers the barriers to entry for Travel Agents

while minimizing the financial risk for Airlines. Travel Agents will have greater flexibility to

operate in the BSP while Airlines will have the ability to distribute via a wider network of Travel

Agents, if they so choose.

GoStandard: It is based on the current Accreditation Model, with a new risk management

process to mitigate default losses and promote safer selling. Local financial criteria and local

remittance calendars continues to apply.

The key change is the introduction of a maximum threshold for outstanding cash sales held in

trust by the Travel Agent pending remittance to the BSP (the so-called Remittance Holding

Capacity). The Remittance Holding Capacity is established for all Travel Agents with access to

cash as a form of payment. As a new feature, Travel Agents under this Model have access to

IATA EasyPay to use on an optional and voluntary basis.

Since this Accreditation Model allows access to cash sales, an on-going assessment of Travel

Agents’ credit history will be performed as well as a financial review on an annual basis. Travel

Agents will be required to provide a financial security based on their credit status or local

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financial criteria. It is expected that the majority of Travel Agents accredited today will remain

under this Accreditation Model.

GoGlobal: It is a “one-stop-shop” accreditation for Travel Agents with operations in multiple

BSPs. Multi-Country Travel Agents meet a single global set of requirements and criteria

(including compliance with local regulation), established in Resolution, and are able to accredit

all their locations worldwide under a single Passenger Sales Agency Agreement. Any location of

the Multi-Country group sharing more than 50% common ownership is required to fall under

the GoGlobal.

Risk management takes place at the parent-level, with the parent undertaking legal and financial

responsibility for all its locations worldwide. Accordingly, the parent is assessed quarterly under

a multi-dimensional assessment framework, and if necessary, the parent may be required to

provide a financial security covering the sales at risk of the entire group. GoGlobal Travel Agents

are also subject to an aggregated Remittance Holding Capacity for the entire group (BSP

remittances nonetheless remains per local calendars).

For multinational Travel Agents, this new model offers greater efficiencies and simplified

processes. For Airlines, GoGlobal Accreditation Model allows for greater visibility of the group’s

sales activities across BPSs and for a more robust risk management of the entire entity.

Travel Agents accredited today will be transitioned to GoStandard. However, Travel Agents may

voluntarily convert across models if and once they meet the applicable requirements.

Applying for a conversion in Accreditation Model (GoLite to GoStandard or GoStandard to GoLite) will be

available via IATA Customer Service Portal (also known as Notice of Change) once the Accreditation

Models are Live circa March 2018. In turn, GoGlobal conversions (GoGlobal to GoStandard2 or

GoStandard to GoGlobal) will not be available until late 2018. The form is part of 812 Resolution and has

been reproduced as an online form for ease of access on IATA Customer Service Portal.

Note, if a Travel Agent has converted to GoLite and then some time later moves back to GoStandard, the

Travel Agent will have the risk event of “Authorization to use Cash payment method for less than 24

months” which will stay in their Risk History for 24 months. Also, Travel Agents will be notified of their

Remittance Holding Capacity and applicable Risk Status.

2 Conversions between GoGlobal to GoStandard will entail a new Passenger Sales Agency Agreement (PSAA).

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Remittance Holding Capacity (RHC)

In today’s online environment, thousands of tickets can be issued in a matter of hours. This is regardless

of the Travel Agent’s past sales, risk status or ability to remit the respective amounts due, creating

significant exposure for the Airlines as evidenced by past defaults and intentional “bust-outs.” Bust-outs

have not only resulted in significant, multi-million dollar losses for carriers; they have also undermined

bona fide Travel Agents and the overall integrity of the system.

To address this risk, IATA has proposed the Remittance Holding Capacity (RHC). The RHC is the maximum

amount of Airlines’ monies held in trust that a Travel Agent may have outstanding at any time to be

remitted to the BSP for Cash sales3. Funds received from customers for these transactions are ‘held’ in

trust by the Travel Agent on behalf of the Airlines until remittance to the BSP.

For Travel Agents with access to a Cash facility under the GoStandard and GoGlobal Accreditation

Models, one of three Risk Statuses will be assigned (A, B or C). This Risk Status will be determined by the

Travel Agents’ ongoing risk history (historical behavior in the BSP) and the outcome of their financial

reviews. For GoGlobal Travel Agents, the financial review will be quarterly, in accordance with the multi-

country assessment framework. For GoStandard Travel Agents, the financial review will be annual in

accordance with the applicable local financial criteria of the Travel Agent.

Each Risk Status will carry different conditions related to financial security requirements, applicable

remittance frequency and the calculation of a Travel Agent’s Remittance Holding Capacity.

How is the Risk Status assigned?

One of three statuses will be assigned per the following table:

Financial Review Result Risk History Assessment Risk Status Assigned

Pass

Pass A

Pass

Fail B

Fail

Pass B

Fail

Fail C

3 The RHC applies to Travel Agents with access to Cash sales (transactions) only, and does not apply for CC sales.

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What are the Cash conditions associated to each Risk Status?

Depending on a Travel Agent’s Risk Status, different Cash conditions will apply as shown below:

Risk Status Assigned

Cash Conditions

A

1. RHC = Calculation (formula – shown below) 2. Financial Security only if required per LFC for Standard Travel Agents with Cash facility 3. Standard Remittance frequency of the BSP

B

1. RHC = Calculation (formula – shown below) 2. Financial Security required 3. Standard Remittance frequency of the BSP

C

1. RHC = Financial Security provided 2. Financial Security required 3. Most frequent remittance frequency in the BSP*

*Applicable for BSPs with multiple remittance frequencies.

In addition to the assignment of a Risk Status, all GoStandard and GoGlobal Travel Agents will be

granted an individual RHC. As described, the RHC is the maximum amount of monies at risk that a Travel

Agent may have outstanding to the BSP at any time. IATA will continuously monitor, in real-time, Travel

Agents’ sales and if ever a Travel Agent reaches the RHC granted, Cash as a form of payment will be

restricted. The Travel Agent will nonetheless be able to continue transacting using other available

payment methods. Once a remittance is received and the Travel Agent’s outstanding amounts fall below

the RHC threshold, Cash as a form of payment will be restored.

How is the RHC calculated? – The RHC formula

These measures are intended to provide Travel Agents with the necessary tools to manage their RHC.

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Risk Status Assigned

Remittance Holding Capacity Calculation

A

Total Days X Daily Average BSP Cash Turnover (3 Highest Reporting periods) + 100%

B

Total Days X Daily Average BSP Cash Turnover (3 Highest Reporting periods) + 100%

C

Remittance Holding Capacity = Financial Security Amount Provided

Under this calculation:

Total Days = Number of days in Reporting period plus number of days in Remittance period.

Daily Average BSP Cash Turnover = Travel Agent’s Average daily BSP cash turnover for the 3

highest Reporting periods of the previous 12 months.

100% = the +100% growth threshold allows room for exceptional situations. However, if the

Travel Agent is aware of a large group or special event upcoming, the Travel Agent can remit

customer funds owing in advance of remittance date to increase the Cash facility available

and/or use IATA EasyPay or the customer’s debit/credit card to issue the related transactions.

The Travel Agent can also provide additional security to raise its RHC.

Travel Agents will also be able to adjust their RHC by amending the amount of Financial Security

provided to IATA. One type of Financial Security option available to Travel Agents is Global Default

Insurance or GDI (see next section), which can be easily adjusted to facilitate changes in a Travel Agent’s

RHC.

As GoLite Travel Agents do not have access to a Cash facility within the BSP, no Risk Status or RHC is

applicable. No minimum Financial Security is required for GoLite-Accredited Travel Agents opting to use

only IATA EasyPay. To address the potential risk related to Credit Card transactions, a minimum financial

security in the equivalent of 5,000 USD is required for GoLite Travel Agents who wish to have access to

the customer card payment method. GoLite Travel Agents’ ADM levels in the BSP will also be monitored

and additional security may be requested if ADM levels exceed a defined threshold.

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Remittance Holding Capacity notification to Travel Agents

Before going Live, IATA will notify the Travel Agent about their RHC and Risk Status (plus Cash

conditions) via email. In turn, the Travel Agent should consider the following guidance to ensure its

readiness for the RHC:

Ideally, assure that the Portal User is in place to receive notifications.

As an optional (transfer method) alternative, set up an IEP account prior to go-Live so that the

Travel Agent can use this form of payment if they reach their RHC.

Assess if they want to increase their overall RHC.

Once the Accreditation Models and RHC are fully Live, Travel Agents (users with Portal Administrator

role) will be notified - that includes an email and a pop-up once they sign into the portal. The Travel

Agency that will receive this portal notification will be assigned a dedicated RHC portal service that they

can further assign to other colleagues.

By doing so, Travel Agents will see on the IATA Customer Service Portal the RHC amount, the consumed

level since the last update from the Risk Monitoring Engine (RME) and they will also have a button that

will allow them to check in real time this value (to monitor their RHC usage directly through the IATA

Customer Portal). Updates from RME are sent only upon 50%, 75%, 100% thresholds. Any changes in

their RHC amount will be communicated as part of an existing process (additional Financial Security, RHC

annual recalculation, etc.). In case the RHC amount changes, the percentage of the consumed RHC is

also recalculated and communicated in the same notification.

A Travel Agent’s RHC will be reviewed at minimum once per year and will be reassessed with any change

to a Travel Agent’s Risk Status or applicable Cash conditions. Travel Agents may also request an ad hoc

recalculation of their RHC considering sales from the previous 12 months.

In case the RHC threshold is reached, Travel Agents will:

Have the ability to continue issuing tickets using IATA EasyPay.

Have the ability to continue issuing tickets using customer cards.

Be able to make full or partial advanced remittances to the BSP to lower their amount

outstanding.

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Global Default Insurance (GDI)

GDI is an additional financial security type available to Travel Agents along with those financial security

types currently acceptable under Resolution 850p, therefore it does not replace any of the current

financial security types included in this resolution.

This new financial security type consists of a standardized global default insurance policy brokered to

Euler Hermes, a global credit insurance company and subsidiary of the Allianz Group. Travel Agents may

list themselves on a voluntary basis under the policy for a defined amount of cover. The amount of cover

obtained consists of an individual limit and corresponds to the amount of financial security being

provided to IATA.

Thus, a Travel Agent interested in GDI will apply directly to Euler Hermes for a cover amount (or limit)

under the GDI policy corresponding to the amount of financial security to be provided to IATA. Euler

Hermes will assess the Agent’s request, then advise if the Travel Agent is eligible and quote the

applicable fees. If the Agent agrees with the conditions and decides to proceed with GDI, Euler Hermes

will confirm the cover and notify IATA. In turn, IATA will invoice and collect from the Agent the fee

amounts due.

Pricing for GDI is fees are determined by Euler Hermes, not IATA, and will be quoted directly by the

insurer to the Travel Agent. A Travel Agent can request a quote on the insurance portal free of charge to

compare with other acceptable forms of security. The GDI does not require the Agent to pledge any

form of collateral. Insured amount can be amended within 2-3 working days and quotes may be

requested directly via Euler Hermes online portal.

Under the GDI, the cost of the insurance (fee) and other administrative costs will be collected from the

Travel Agents by IATA on a cost recovery basis as IATA is the policyholder, beneficiary and named

insured, and has to comply with the obligations of the policy, in particular paying the insurance.

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TRAVEL AGENT READINESS

STRATEGIC CONSIDERATIONS FOR TRAVEL AGENTS

Strategy

The key opportunities NewGen ISS may bring to Travel Agents are as follows:

BSP Accreditation.

NewGen ISS approaches the air industry going from one Accreditation to three Accreditation

Models. This new approach will imply:

Travel Agents will have more options for Accreditation which will offer better suitability

for their different business needs:

o GoLite is an option for Travel Agents that do not want to provide Financial

Securities and can work on a pay-as-you-go basis.

o GoStandard is an option for Travel Agents that want to continue as they do

today, with possibility to reduce current Financial Securities in case they have

one.

o GoGlobal is an option for Travel Agents working in multiple BSPs and that want

a streamlined and one point of Accreditation covering all locations.

A simplified entry to the BSP: IEP facilitates the implementation of Travel Agents

Accreditation Models and is specifically important for Travel Agents under GoLite as

those Travel Agents will not have access to Cash.

A possibility for current Travel Agents to reduce or remove their Financial Security

amounts, if those Travel Agents user other form of payment than Cash.

A Travel Agent may need to consider:

To inform themselves about the different Accreditation Models and requirements and

apply for the Model best suitable for their business.

Options to reduce or remove Financial Securities.

For Travel Agents finding Financial Securities burdensome and expensive, there are other

options to manage their business:

Travel Agents may change their Accreditation Model (a transition).

Travel Agents may use IATA EasyPay.

GDI as a viable security option for Travel Agents:

Option to current Financial Securities that does not require collateral or application fees.

Provides competition to current Financial Security options.

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A Travel Agent may need to consider:

To compare GDI with their current terms and conditions and decide on what option is

best for their business.

To inform themselves about the different Accreditation Models and requirements and

apply for the Model best suitable for their business.

To use IATA EasyPay to reduce Financial Security amount requirements.

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ANNEXES

ANNEX A – IEP PORTAL GUIDE

Depending on the country, a specific vendor is used to provide the IEP portal.

See separate document (.pdf): IEP Portal Guide.

Applicable to the following BSPs:

Belize

Benin

Bermuda

Burkina Faso

Cameroon

Chad

Congo (Republic of)

Cote d'Ivoire

Denmark

El Salvador

Finland

Gabon

Hungary

Iceland

Mali

Mauritania

Mexico

Nicaragua

Niger

Norway

Senegal

Singapore

Sweden

Togo

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ANNEX B – IEP PORTAL GUIDE

Depending on the country, a specific vendor is used to provide the IEP portal.

See separate document (.pdf): IEP Portal Guide.

Applicable to the following BSPs:

Bahrain

Canada

Chinese Taipei

Costa Rica

Egypt

Guatemala

Honduras

Lebanon

Oman

Panama

Qatar

Saudi Arabia

United Arab Emirates

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ANNEX C – IEP TRANSACTIONS HANDBOOK

See separate document (.pdf): IEP Transactions Handbook.

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ANNEX D - IATA EASYPAY REPORT SAMPLES

Periodical billing reports

Sample 1 – Agent Billing Details

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Sample 2 – Agent Billing Summary

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BSPlink IEP Online Billing Reports

See separate document (.pdf):

NewGen ISS · Then Travel Agent collects the funds on ... DISH Data Interchange Specifications...

Documents

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