IRCTC’s Revised Fee Structure Upsets Online Travel Operators

According to a document released in June, the IRCTC will now collect an annual maintenance charge (AMC) of Rs 12 plus taxes for every train ticket booked with the help of online travel agents.

New Delhi, July 24: The new fee structure revised by the Indian Railway Catering & Tourism Corporation (IRCTC) has caused a stir among the online travel operators in India. As per a report, the cost of providing the service of booking train tickets to customers is expected to increase a 10 fold. Depending on the number of bookings in hand, the executives expect that the cost borne by the travel agents will increase between Rs 40 crore and Rs 50 crore.

According to a document released in June, the IRCTC will now collect an annual maintenance charge (AMC) of Rs 12 plus taxes for every train ticket booked with the help of online travel agents. In case the annual maintenance charges (AMC) falls short of the minimum fixed amount including tax, the difference will be collected from the online travel agents during the renewal of the service.

The chief executive officer of one of the largest online travel agents with IRCTC reportedly said, “IRCTC charges used to be a flat Rs 25 lakh for almost every integration that we had to do, be it payment gateway, as agents, or as a wallet option on their platform. Now with the pricing being moved to a per-ticket basis, it might be easier for smaller startups for whom the down payment used to be a challenge, but for others, it is a cost that will be eventually passed on to consumers.”

The IRCTC has clearly stated that for every 70 searches, one booking will be allowed and Rs 25 paise plus tax will be collected on a daily basis for each inquiry that is made above the ratio.

A senior executive reportedly said that the ratio is higher because OTAs primarily cater to non-rail customers. He added, “Apart from serving as a booking channel, these platforms are used by customers to check schedules, availability of trains, flights, and buses to plan their full itinerary, which leads to multiple hits.”