FinAC News is a communication tool created to keep members of the Industry Financial Advisory Council (FinAC) and their Working Groups up to date with the latest news and achievements, and for them to keep an eye on the status of the actions agreed during the various meetings.
This is a private page, dedicated to FinAC and FinAC Working Groups members. Please do not share the link to this page beyond this group of people.
IATA Industry Affairs Bulletin
Working Groups members have requested to be kept up to date with the advocacy activities performed by IATA in areas beyond Finance. To satisfy this request, FinAC and Working Group members will now receive via email the Industry Affairs Bulletin, a monthly publication from the Industry Affairs Advisory Council.
The email will be sent from email address: email@example.com. We suggest you save this address in your contacts to avoid the Bulletin going into your Junk folder. Enjoy the reading!
Henry Coles becomes FinDev IATA Secretary as of January 2020
We are pleased to announce the appointment of Henry Coles as the new IATA Secretary for the Financial Services Development Working Group (FinDev) as of 1 January 2020.
Henry is an experienced leader in the airline industry, with a background in international airlines crossing finance, revenue management, network planning distribution and alliances. As Head of Airline Distribution Standards for IATA, Henry leads the global team responsible for industry passenger standards, including key transformation programs. Working with member airlines and industry stakeholders, Henry's role includes the development of industry policy and strategy supporting passenger processes, distribution and interline. He also oversees all the standards development activity under the Passenger Standards Conference, and IBSOPS General Meeting, together with the IATA Prorate Agency; and manages over 35 groups.
Henry is a qualified Accountant, with degrees in Accountancy and Aviation Management, and a Master of Science in Air Transport Management. During this period, he will be supported by Christine de Castro, Coordinator of FDS Transformation.
Henry replaces Eric Léopold in the capacity of FinDev Secretary.
FinAC Steering Group meeting
November 2019 - The FinAC Steering Group met on 18 November to review the input provided by the Working Groups on their top five activities to deliver the strategy. Thank you for your great work!
The focus of the meeting was on Strategic Priorities "Efficient Airlines Processes" and whilst a lot has been achieved, the work is not completed yet. The Steering Group will meet again in January 2020 to go through all Strategic Priorities and a detailed feedback will be given to all Working Groups after that.
Collecting data to deliver the strategy
November 2019 - At its September meeting, FinAC endorsed the IATA vision for Efficient Airlines Processes. One of the elements of the vision concerns Transparent and Innovative Payments. IATA developed a detailed methodology to deliver the vision with the support of the Payment Methods Working Group (PMWG). As a first step, PMWG is collecting input from airlines on which cost items have the biggest impact on their P&L and should therefore be addressed with priority. The PMWG needs airlines' support in collecting data and you can all participate to this effort by filling out a survey. Please note that it is important that the survey reflects different points of views within the airline, including that of the payment, treasury, and fraud prevention functions. Your contribution is very much appreciated and will play a critical role in the delivery of IATA strategy for Efficient Airline Processes.
If you wish to participate to the survey, please contact Laura Cajade (IATA's Head of ISS Product Management) or Lamyaa Khattabi (IATA's Senior Manager Treasury Services and Currency Repatriation).
Thank you very much!
November 2019 - The NewGen ISS programme is currently on track to exceed its 2019 target as set by the Board of Governors, to be live in markets representing 90% of global BSP Cash sales. As of November 16, NewGen ISS and IATA EasyPay have been implemented in 87 BSPs worldwide. With the implementation of Saudi Arabia, Oman, Bahrain, and Botswana, over 85% of global BSP Cash Sales are covered by the NewGen ISS risk management framework and Remittance Holding Capacity. An additional 11 markets, including Brazil, South Africa and Indonesia will be implemented before end of year, taking the BSP Cash sales coverage to approximately 93% ."
Transparency in Payments exceeded 95% target for BSP credit card sales coverage
November 2019 - Last 15 November, the roll-out of TIP was rolled out in Brazil which exceed 95% of BSP credit card sales coverage target. TIP is now live in 133 BSP operations. During the last PAConf meeting in Oct. 2019, MasterCard announced 5 lower tier prices for its travel agency card product, open for Airlines to choose. Diners announced during the same meeting a new Travel Agency card product at lower cost, which will be based on the Airlines' consent and will be enlisted in TIP. Currently Airlines representing 66% of the BSP Card volume have defined and issued their individual payment policy.
Completion of Real Time Settlement Capability in China
November 2019 - The implementation of the Real Time Settlement capability in China for the BSP transactions has been completed. This solution allows a faster settlement process (i.e. real time to one day), according to the choice of the airline, and with the same security as the traditional BSP settlement.
Dynamic Offers officially launched during the 2019 AIR Symposium
November 2019 - IATA introduced Dynamic Offer - an industry beyond fares filing and booking class - for the 1st time at AIRS in October 2019. The project – together with NDC & ONE Order - is a key component of the IATA Board strategic priority to enable "Product Differentiation". IATA is taking a leading role to support airline's agility to retail dynamic offers in all sales channel with the following industry benefits:
- Enhance conversion rate with relevant offers – driving customer satisfaction;
- Improve customer choice via enhanced offers driven by continuous pricing algorithms;
- Manage total offers with new partnerships – driving customer retailing offers.
Settlement with Orders
November 2019 - The first release of the Settlement with Orders (SwO) standard has been approved by the Passenger Standards Conference (PSC) (14, Oct in Warsaw), while the Passenger Agency Conference (PAConf) approved the inclusion of the settlement of Orders in its resolutions last 23 October.
The first SwO pilot between British Airways, Click Travel a UK Travel Agency and IATA is already giving good results showing the benefits of the standard. British Airways already committed to go in production in 2020 with a limited number of agents and BSPs.
Eleven IT providers are part of the SwO adoption group and three already committed to support the standard next year.
FinDev recommended to develop further the SwO standard for interline to support the Future of Interline.
November 2019 - At the latest Airline Industry Retailing Symposium in Bangkok, IATA announced that the interim target for the NDC Leaderboard airlines set at 8% for 2019, was achieved in September.
The NDC Leaderboard is currently comprised of 21 airlines that weigh over 30% of IATA passenger volumes which have committed to a target of having 20% of their indirect sales powered by an NDC API by 2020.
Olympic Air will join the NDC Leaderboard on 1 January 2020.
November 2019 - To recognize and support stakeholders who are driving the development and implementation of ONE Order, IATA launched the ONE Order certification program at the beginning of 2019.
The ONE Order Registry lists:
- Airlines deploying ONE Order communication messaging and capability
- Vendors and IT Providers offering ONE Order solutions and services (Order Management Systems, Delivery Providers and Accounting Providers)
The certification program was met with excitement by the industry and exceeded our expectations with 20 stakeholders piloting and being certified for their ONE Order messaging and capabilities.
November 2019 - On the 1st November 2019, IBSPs completed the migration of all DPC's to the new IATA DPC Software. The migration program moved 136 BSP's from their previous DPC's proprietary software's to the IBSPs standard."
Air Think Tank White Paper officially released during the 2019 AIR Symposium
November 2019 - The 2019 AIR Think Tank completed and distributed the White Paper at the AIR Symposium and presented 3 POCs (Project Lemonade, Project Robot and Project TrulyMe) on stage.
Identity Management 2.0 Project gets official endorsement
Identity Management 2.0 Project was endorsed by the Digital Transformation Advisory Council (DTAC) and Travel Board
Distribution Risk Community Bulletin
The first Bulletin of the IATA Distribution Risk Community was distributed to its members on 7 November 2019.
You can access the IATA Distribution Risk Community Bulletin here.
Industry Webinar - IFRS 16 Key Implementation Issues
IATA is launching a series of webcasts to help the airline finance community navigate in the variety and complexity of the topics int the areas of Finance and Distribution. Industry Accounting, Payment and SIS features are just some of the topics that will be addressed. Delivered by IATA and IATA Finance (FinAC) Working Groups members, the webinars are informative sessions from the industry to the industry and are open to anyone interested. Don't hesitate to sign up and spread the word with your airline contacts!
The upcoming webinar(s):
Key implementation issues related to the new accounting standard on leases: International Financial Reporting Standards 16 (IFRS 16) will be explained and illustrated.
Target audience for this session are finance or operational professionals that has a need to understand the implications of the new accounting standard on leases.
Objectives of the webcast:
• How to account for major maintenance on lease
• Auto-renewal leases
• Interaction of lease terms and lease improvements useful lives
• Treatment of Valued Added Tax in a lease agreement
Webcast Date: 13 November 2019
Time: 09:00 to 10:00 am CET OR 15:00 to 16:00
The Webinar will be delivered by two members of the Industry Accounting Working Group, namely Sean Penning (CX - for the AM session) and John Vierdag (KLM - for the PM session).
You may download the IATA Industry Accounting Working Group Guidance IFRS 16, Leases prior to the session.
Future of Financial Services Forum
Last 24 September, the Financial Services Development Working Group
, also known as FinDev, organized the Future of Financial Services Forum to engage with the wider airline financial community that were present at the WFS. The Forum, which was attended by about 30 airline representatives, presented FinDev’s role, its areas of activities, and its main achievements over the last five years. Comprised of 12 airline members, FinDev acts as an advisor to the Industry Financial Advisory Council (FinAC) on matters related to the strategy of the industry financial services and settlement systems, as well as on standards supporting airlines’ financial processes.
The Forum gave an overview of FinDev’s main achievements since the group’s creation in 2014. This includes the back-office simplification project, ONE Order
, and the Cargo Billing Solution project to name a few. All of these have been achieved in consultation with other working groups of industry financial experts (Payment Methods Working Group
, ISS Risk Management Working Group and Industry Taxation Working Group
In addition, the group also did a spotlight on two new technologies which they believe will be beneficial to the airline financial services namely Blockhain, and AI for Risk Management. FinDev believes that Blockchain has the potential to disrupt the current airline financial processes to move to a digital environment that is safer, faster and frictionless.
FinDev also believes that Data Science and Machine Learning have great potential to solve business problems in different areas of our industry. A practical use case was presented where IATA’s Data Science in Aviation Team created a machine learning model to label every BSP card transaction within a country on whether it is an agent or a customer card (Transparency in Payments).
FinDev has been putting a lot effort in communicating with the airline financial community this year to promote and raise awareness on its initiatives and activities . For 2019, the group also conducted webinars on Complex Taxes, Settlement with Orders, and VAT for Ancillaries. Overall, the event has been a success and the group got very encouraging feedback. In fact, some airlines have even raised their interest in joining FinDev.
The First Industry-Owned Travel Tech Accelerator
Accelerate@IATA is the first industry-owned start-up Accelerator. Its objective is to accelerate the adoption of IATA initiatives and to stimulate new entrants in the industry. IATA will facilitate and run the Accelerator, and airline members and value chain partners will join as members of Accelerate@IATA.
The initial focus of Accelerate @ IATA will be air retail, stimulating new entrants to adopt IATA standards in the areas of: Aggregation, Dynamic Offers, Order Management, and Airline Profile.
Accelerate@IATA will accelerate approximately twenty (20) to thirty (30) start-ups per year in three batches, each comprising up to ten start-ups, and having its own acceleration theme. Each acceleration batch will last three months, and have a dynamic curriculum based around IATA expertise, mentorship, and business coaching so that the start-ups can adapt their solution based on industry requirements. The expected outcome of each batch is to establish sustainable solutions from new entrants in the industry and enabling airlines to implement faster industry initiatives.
How does the Accelerator work?
The Accelerator enables a close collaboration with corporate partners (composed of airlines, industry partners and technology companies) and start-ups.
During a 12-month period, the Accelerator will operate up to 3 batches for a period of 2 months each, hosted at the IATA Executive office in Geneva.
Every batch will be divided into four phases:
1. PHASE 1 Start-up sourcing phase, closing with Selection Day
30 start-ups are sourced globally to come and present their solution during Selection Day. A maximum of 10 of them are selected to enter the acceleration program
2. PHASE 2 Acceleration process
3-month program, with one focus week per month where the start-ups receive industry knowledge and expertise from IATA, and coaching and mentorship from IATA, member airlines, and value chain partners
3. PHASE 3 Closing event to present solutions: Demo Day
Event where the accelerated start-ups present their adjusted solutions and pilot or implementation plans with corporate partners.
4. PHASE 4 Pilot phase with airline partners
Airlines and value chain partners willing to participate in the Accelerator program will contribute by paying a fee. The level of this financial contribution depends on their level of involvement. There are two levels of involvement possible for corporate partners: Anchor partners and Ecosystem partners. (See visual about the Accelerator operating structure)
In short, the Accelerator Committee, composed by IATA and Anchor partners, sets the technology and business focus for each of the acceleration batch. They are active decision makers during the entire program through the start-ups' selection process, acceleration involvement, outcome and pilots.
At its January 2020 meeting, the FinAC Steering Group will discuss potential topics to be accelerated in the area of airline finance.
News on the HIPO front!
IATA has launched a new Airline Finance Professionals community on LinkedIn. You are invited to join: bit.ly/iata-community
A space to share insights, discuss industry challenges and learn about best practices for airline financial management. It aims to support airlines in their journey to becoming high performing organizations (HIPO).
2 new courses are now available:
Those of you participating in WFS will be able to learn more at the HIPO booth in the WFS exhibition area!
FinAC SG/ WGs Joint Meeting Follow-Up
On 19 June 2019, the Chairs and Secretaries of the FinAC Working Groups met in Madrid for their yearly gathering. As always, the meeting was lively, with a very high engagement from all participants.
A series of actions were agreed at the meeting. The status of such actions is available here (pdf).
Pay Cargo – Contact Details
During the last meeting of the Financial Committee (FC/120) in April in Singapore, the PayCargo solution, in partnership with IATA, was presented. The solution facilitates the payment of cargo import terminal charges such as documentation, warehousing and other ancillary charges related to the cargo handling at destination.
For any additional information about the PayCargo/IATA Solution, please contact Lionel Van der Walt, CEO at PayCargo.