Just as the summer travel season was expected to gain momentum, fresh disruptions in key transit hubs have left travel agents in limbo. With refunds stuck, fares surging, and bookings slowing, the situation is raising questions about risk, responsibility, and resilience.
Janice Alyosius
The ongoing geopolitical tensions affecting key Middle East transit hubs have disrupted travel flows from India, creating widespread uncertainty across the aviation and travel trade ecosystem. With flights impacted and schedules in flux, the ripple effects are being felt by travel agents managing advance inventories and group bookings. What was expected to be a strong summer season, supported by reduced TCS and pent-up demand, has turned volatile. Airfares have surged, capacity remains constrained, and travellers are opting for cancellations over rescheduling. Caught between airline policies and customer expectations, agents are facing a difficult situation. At the centre of the issue is the long-standing practice of pre-purchasing airline inventory. While this model offers higher margins, it also exposes agents to significant financial risk during unforeseen disruptions. Anil Kalsi, Vice President, TAFI, explained the complexity of such arrangements in detail. “Pre-purchase ticketing is a risky business. Although it offers better margins than normal ticketing, there is a lot at stake, especially in unforeseen circumstances. When you buy pre-purchased inventory, you pay an upfront amount, which is typically non-refundable. That effectively becomes a guarantee from the agent’s side that a certain number of passengers will travel through them,” he said. He elaborated on how these agreements operate outside formal systems. “This deposit is not made through regular BSP channels. It is usually part of a direct agreement between the airline and the agent, which means it falls outside the purview of standard ticketing mechanisms. In such cases, everything depends on the strength of the relationship between the airline and the agent when it comes to refunds or adjustments,” Kalsi noted.
Highlighting the current challenges, he added, “Even passengers who have booked directly with airlines or through online platforms are struggling to get refunds because airlines are overwhelmed with requests. At such times, travel agents receive a large number of calls from people who are unable to reach airlines. This clearly shows the difference between booking through an agent and booking independently. When tickets are issued through agents, we have control over the PNR and can process refunds or reschedule under waivers more efficiently.”
Dinesh Kumar, Chapter Chairman, TAFI – Northern India, pointed out that the issue is particularly severe for agents holding group bookings and fixed departures. “Agents who have blocked seats in advance for group movements are now facing a situation where travel is not possible. In such cases, the airline should support the agent because this is clearly an unforeseen situation. No one can predict events like war or geopolitical disruptions, and this falls under force majeure conditions,” he said.
He stressed the need for support mechanisms. “Ideally, airlines should either provide a full refund, issue a credit note, or offer a voucher that agents can utilise for future bookings. However, in reality, it varies from airline to airline. Some are supportive, while others are not as responsive, which creates inconsistency in how agents are able to recover their funds,” Kumar explained.
Kumar also highlighted the financial strain agents are currently facing. “We are already dealing with a cash flow crunch because refunds from airlines are delayed or pending in some cases. At the same time, we are refunding our customers in full because that is necessary to maintain trust and survive in the market. The challenge is how long agents can continue to absorb these losses without external support,” he said. On traveller behaviour, he noted a clear shift. “At this point, clients are not willing to take chances. They are asking for full refunds rather than rescheduling their travel. The uncertainty around safety and flight operations has made people cautious, and that is directly impacting bookings,” Kumar added.
Sameer Karnani, MC Member and Chairman – Airline Council, TAAI, said that airline responses remain mixed. “Many airlines are refunding the money considering the current situation. At the same time, there are some airlines that are offering wallet credits, instead of refunds, which agents will have to use for future transactions. This creates a challenge because it locks working capital for agents,” he said. He also pointed to the sharp rise in fares and impact on demand. “Airfares are currently very high. As a result, business is drying up”, Karnani explained.
