Speakman calls for ‘travel bank’ protection solution

Travel Counsellors’ chairman David Speakman has called for an independent financial organisation to hold holidaymakers money as a solution to confusion over consumer protection.

Speakman, who has been vocal about consumer protection issues and the misunderstanding around particular associations, said an independent “travel bank” should be created to hold money and not travel companies themselves.

It comes after Travel Counsellors’ recent customer survey found 80% of consumers are confused about financial protection when it comes to holidays. Although many found consumer protection to be very important (45.4%), 13.25% were very confused about protection and another 66.2% were also unsure.

“It [the ‘travel bank’] will allow the industry to obtain commitment from the customer but prevent travel companies from losing customer money before they received what they have booked,” explained Speakman. “This will take time because tour operators’ cash flows are now dependent on getting money very far in advance, but it’s the right thing to do for holidaymakers and the reputation of the industry. It’s simply got to change,”

In the survey results it appeared that those who booked with a credit card were the most confident in knowing how they would get their money back, while only 12.45% were certain they understood the Flight Plus scheme.

The industry would hope this level is set to improve as the Civil Aviation Authority (CAA) prepares to launch the second wave of its ATOL advertising campaign.

However, the Travel Counsellors survey found 54.45% of customers think the ABTA logo is a sign that a holiday is financially protected.

“Financial protection in the travel industry is now such a jigsaw puzzle that many travel companies are as confused as customers and people are booking holidays thinking their money is protected when it’s not,” added Speakman.