A travel agents lobby has directed its members to cease extending credit facilities to customers, citing poor cash flow in the wake of Covid-19 outbreak.
The move by the Kenya Association of Travel Agents is set to affect corporates, State agencies, non-governmental entities and traders who book for travel but pay in an extended period.
Chief executive Agnes Mucuha said the policy takes effect upon resumption of aviation travel and would ensure the businesses only deal with cash-paying clients to remain operational post-pandemic.
“All travel agents have been adversely affected by the Covid-19 pandemic. They have not been trading, and have been operating on negative cash flows and zero sales in the past three months,’’ she said.
The closure of the airspace on the March 26, led to suspension of flights while travellers cancelled bookings.
The industry had been operating on a 15-60 days maximum credit period, and within the commercial agreements signed by the trading parties, while offering customers the option to pay via credit cards, bank transfers, mobile money, current cheques or cash.
“The agent businesses are cash negative and their pursuit of debt collection from government agencies, corporate companies, NGOs and diplomatic missions has been coupled with extreme difficulties,” said Ms Mucuha.