Washington — The number of debit memos created per airline ticket issued by ARC has fallen by 46% since 2013, ARC said here today.  



The reduction has been most significant in the last year, falling 26% between 2014 and 2015, after a 16% reduction from 2013 to 2014.

Based on data for the first nine months of the year, ARC projects that in 2015 there will be one debit memo created for every 365 tickets issued through ARC, down from one for every 289 tickets in 2014 and one for every 249 tickets in 2013.

The dollar value of those reductions has fallen much less precipitously, by only 10% since 2013. This year ARC projects there will be $1 of debit memo created for every $733 in ticket value issued through ARC, compared to $663 in 2013. The number went up slightly in 2014, to $1 per every $638.  

ARC attributes that to the high dollar value of credit card chargeback debit memos, which represent 32% of all debit memo dollars issued, but only 13% of their volume, an issue ARC is focused on fixing.  

The reductions come three years after ARC launched its Debit Memo Working Group (DMWG), which has resulted in vastly increased collaboration among the players involved in over 90% of debit memo creations: the airline carriers, travel agencies and GDSs.

"They are coming together to really talk to each other for the first time," said Doug Mangold, ARC managing director of product, who presented the findings to the DMWG on the eve of ARC's annual TravelConnect conference here, which kicks off Oct. 22.

ARC launched the DMWG several years after it created the Memo Manager application, which enabled it to tally the number and dollar amount of debit memos. According to Mangold, once it had enough data, ARC could identify the root causes of debit memos and begin tackling them.

"The numbers are good," he said. "But we're in a marathon; it's not a sprint. We're just getting started and we have a lot more to do."
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