What is a secure trust account?
A trust account is a bank account operated by independent trustees appointed by the Travel Trust Association (TTA) of which we are members (Q9630).
All of your money is paid into this trust account and we are not able to make payments from it. Only the trustees can make payments from the account and will only do so under the following strict criteria:
- When you have returned from your holiday
- When we need to pay for an element of your holiday. To do this we must submit a payment request to the trustees and get it approved. It will only be approved if the supplier has already been checked and added to the TTA's approved supplier list. Supplier Failure Cover must also be taken out against
The purpose of this trust account is to ring-fence your funds and ensure that they are only used to pay for your holiday services and not used by us for any other purpose.
We believe this to be the most secure way of protecting customer monies as it offers 100% financial protection.
In the unlikely event of our financial failure, the trust account has a "fulfillment" process that will take over the administration of the trust account to "fulfill" your holiday.
This means collecting your balances and paying for the services of your holiday. If this is not possible then any funds still in the trust account will be refunded to you.
A trust account is the only way to ring-fence customer monies and not have that money fully controlled by the holiday provider.
A lot of holidays are paid for months in advance and you do not get the product as soon as you pay for it. If your monies get paid into the travel company's own bank account then it could be used to pay their overheads or for other things that aren't related to your holiday. This can lead to companies using customer monies to cashflow their business and eventually into financial difficulty.
Having a trust account forces us to ensure we have other finance options available to cash flow our business and not have to rely on customer monies.
In fact, the CAA (Civil Aviation Authority) is currently consulting on reviewing the ATOL regulations and one of the main considerations is to force travel companies to operate a trust account if they want to have an ATOL license, which proves how secure they are.
- Always look for financial protection when booking a holiday, especially a secure trust account.
- Check for membership of a trade body such as the TTA