U.K. Agencies Weighing Invoice Fees, Warns GTMC - Business Travel News

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U.K. Agencies Weighing Invoice Fees, Warns GTMC

September 13, 2011 - 02:05 PM ET

By Amon Cohen

Some British travel management companies may introduce fees for taking client payments by invoice after seeing this year a substantial switch from card settlements, senior officers of the Guild of Travel Management Companies warned on Tuesday.

"We've seen a 20 percent shift from card to invoicing at Portman Travel, and I would suggest our numbers are pretty much the norm," said Portman chief executive Mike Hare, who is chairman of the GTMC. Those customers moved to invoicing following the April introduction by British Airways of a £4.50 surcharge on payments by card through travel agents. Most Lufthansa Group airlines introduced a similar charge in the United Kingdom earlier this month. However, Hare added that few of the clients that have made the switch are multinational corporations.

British TMCs traditionally have not charged for extending credit facilities to their corporate customers, but GTMC deputy chairman Ajaya Sodha warned that now could change. "If this trend continues, TMCs might look at increasing their fees or adding a supplement," he said. Some TMCs in Germany have introduced invoice-handling fees.

So far, BA and the Lufthansa Group are the only carriers to have introduced card surcharges in the United Kingdom, but GTMC indicated that another unidentified airline is strongly considering following suit.

Hare and Sodha gave their views during a GTMC media briefing in which they said there is no sign of a fall in business travel demand, in spite of declining economic confidence worldwide. Each month this year, Billing and Settlement Plan figures show a year-over-year increase in the financial volume settled with airlines by U.K. travel agents of 6 percent to 9 percent. GTMC members' BSP figures have been even better, consistently up by double-digit percentages, Hare said. He attributed the improvement to more flights, a return to business class and, in particular, the boom in travel to emerging markets. "Try getting a premium cabin seat to BRIC [Brazil, Russia, India and China] countries at the moment," said Hare. "You can't get them."

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