Islamabad: A leading travel agent of UK has defaulted to IATA, on the outstanding amount owed to various airlines, including 0.65 million pounds due on PIA.
According to IATA rules an agent must settle financial claims of the first fifteen days of a month by the 2nd of next month with Bank Settlement Plan (BSP), the financial settlement arm of IATA, and till then is allowed to sell tickets. If some agent fails to pay the amount due to the airlines by that date, he is immediately delinked by IATA until the outstanding dues are cleared. Airlines do not settle financial accounts directly with travel agents and have to deal through BSP.
The amount of £0.65 million is from September 1 to October 2, the day when this agent reported default. The agent was not allowed to sell tickets beyond that date.
This agent was PIA’s second biggest selling agent in the UK and had sold tickets worth four million pounds during the last year.
BSP is taking legal action against the defaulting agent for recovering the amount they owe to various airlines. PIA is in contact with BSP on this matter and would also utilize bank guarantees and incentives deposited by the agent with PIA.