Norway becomes first country to implement Iata’s Settlement Systems

Norway becomes first country to implement Iata’s Settlement Systems

Norway has become the first country to implement a new generation of Iata Settlement Systems with more to follow.

NewGen ISS is being touted as the “most extensive and ambitious” modernisation of the Iata Billing and Settlement Plan (BSP) since it was created in 1971 to enable the global distribution and settlement of passenger funds between travel agents and airlines.

BSP processed $236.3 billion in airline funds with virtually 100% on-time settlement last year alone, according to the airline trade body.

NewGen ISS will be implemented in Finland from March 16, Sweden and Canada from March 26, Denmark from April 1, Bermuda from April 9, Iceland and Singapore from April 16, with the overall introduction rollout expected to be completed in all BSP markets by the first quarter of 2020.

Iata financial and distribution services senior vice president Aleks Popovich said: “As the first market to implement NewGen ISS, travel agents and airlines in Norway are in the vanguard of a vital transformation to modernise the industry’s settlement functions while ensuring the viability of the travel agent shopping channel used by millions of passengers every day.

“While Norway is a relatively small travel market, it is technologically advanced and has a history of embracing new solutions, making it the ideal environment to go live with NewGen ISS.”

Popovich added: “NewGen ISS go-live in Norway represents the culmination of years of planning, engagement and effort with participants across the air travel value chain, including airlines, travel agents, and IT and system providers.”

NewGen ISS consists of four elements:

Iata EasyPay – a new voluntary pay-as-you-go e-wallet solution for issuing airline tickets in the BSP with a low cost per transaction. As a secure form of payment, Iata EasyPay transactions are not part of a travel agent’s cash sales at risk. This allows agents a means to lower their financial security amounts held with Iata, and to issue transactions which are not included in their BSP Remittance Holding Capacity

Remittance Holding Capacity (RHC) – a risk management framework to enable safer selling and mitigate losses resulting from travel agency defaults. For the majority of agents, RHC is calculated based on the average of the three highest reporting periods of the previous 12 months plus 100%. Furthermore, measures are available allowing agents to manage their RHC, and to continue selling in a secure manner should their RHC ever be reached, such as with Iata EasyPay.

Three levels of travel agent accreditation, offering agents greater flexibility. Agents will be able to choose the model most applicable to their business, as well as to convert across levels as their business evolves. These models are:

· GoGlobal Accreditation is a “one-stop-shop” accreditation for agents with operations in multiple BSPs. Multi-country agents will meet a single global set of requirements and criteria and will be able to accredit all their locations worldwide under a single Passenger Sales Agency Agreement.

· GoStandard Accreditation corresponds most closely to the current accreditation, and is for agents operating in a single country. These agents will have access to all the BSP forms of payment – cash, credit card and Iata EasyPay. Initially, all agents in Norway will have GoStandard Accreditation.

· GoLite Accreditation is a simpler form of accreditation for agents that will ticket only using Iata EasyPay and/or customer credit cards. As there is limited financial risk, the security requirements are minimal.

Global Default Insurance – an optional financial security alternative for agents that presents a cost effective and flexible alternative to bank guarantees and other types of security.

Norway will also be the first country to introduce another vital innovation when the Transfer in Payments initiative in April.

TIP is an industry initiative focused on providing airlines with increased transparency and control in the collection of their sales through the travel agencies.

At the same time, it will enable agents to take advantage of new forms of payment for the remittance of customer funds.

No form of remittance is barred by TIP, but agents can only use those forms to which an airline has previously given consent.

Importantly, if an airline consents, TIP allows travel agents to use their own credit cards – previously not supported in BSP, according to Iata.

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