Debit Memo Annual Value Dropped $25 Million in 2017 Compared to 2016
ARLINGTON, Va. – January 23, 2018 –Airlines Reporting Corp. (ARC) released the air travel industry’s first set of best practices for managing debit memos, created and approved by the ARC-facilitated Debit Memo Working Group (DMWG) last month.
Since the DMWG’s first meeting in 2013, member representatives from airlines, travel agencies, global distribution systems (GDS), ATPCO and American Society of Travel Agents agreed that an industrywide set of best practices would help streamline the debit memo process to save time, resources, and enhance communications for all parties involved. The new best practices are the result of more than a year’s specific focus and collaboration on the issue.
Every day, ARC settles approximately $238 million in airline ticket transactions between more than 220 airlines and nearly 7,000 travel agencies. In 2017, debit memos valued at $119.4 million were issued compared to $145.1 million in 2016.
“From Delta’s perspective, having best practices in place sets goals and expectations for airlines, agencies and GDS providers allowing all to improve customer service and provide consistency for the debit memo process from end to end,” said Delta Air Lines Revenue Recovery Manager Hope Harper.
Paula Peitz, director of airline accounting for Carlson Wagonlit Travel, commented, “When debit memos do arise we can all leverage this document to examine our habits, and align to the best of our ability with what the industry has defined as best practices. This will drive consistency in our processes and allow us to work more effectively with our industry partners.”
Covering all phases of the debit memo lifecycle, best practices include recommendations for debit memo training for travel agents and airlines; auditing and issuance; debit memo research, communication and response; and debit memo resolution. Each category recommends responsibilities for each participant in the debit memo process including agency, airline and GDS.
“ARC understands the need for each airline, travel agency and GDS to make its own commercial decisions, but we encourage our industry partners to consider adopting these best practices in order to provide a more predictable, clear and effective way to resolve debit memos,” said Paige Blunt, ARC’s industry relations manager. “It is important to note that the best practices are guidelines and, while our ultimate goal is providing benchmarking around the best practices, they will not be enforced by ARC.”
The best practices are available online, and as they are adopted, ARC will benchmark their impact to the travel industry. The DMWG plans to revisit as needed, making necessary revisions as the industry evolves.
The next in-person meeting of the full DMWG will be held October 9–10, immediately before ARC’s annual TravelConnect conference in Oxon Hill, Md., October 11–12.
As a leader in air travel intelligence and omnichannel retailing, ARC provides platforms, tools and insights that help the global travel community connect, grow and thrive. ARC enables the diverse retailing strategies of its customers by providing innovative technology, flexible settlement solutions and access to the world’s most comprehensive air transaction dataset. In 2019, ARC managed more than $97.4 billion in transactions between airlines and travel agencies, representing more than 302 million passenger trips. For more information, please visit arccorp.com.