News Releases

ARC Debit Memo Working Group Agrees on Reason Code Standards for Debit Memos

Major Milestone Clarifies Root Causes to Reduce Memo Frequency


ARLINGTON, Va. – November 02, 2015 - Airlines Reporting Corp. (ARC) announced that its Debit Memo Working Group (DMWG) has created standard reason code definitions for all major categories of debit memos, successfully completing a 2015 priority. Categories include commissions, fares, taxes, refunds, exchanges, fees and credit card chargebacks. Standard reason codes will allow both travel agents and carriers to better analyze why debit memos are issued and create action plans to reduce their frequency.

The DMWG expects to publish and distribute the standard reason codes to all ARC participating carriers and agencies by the end of first-quarter 2016. The group reported this milestone after its semi-annual meeting held recently in the District of Columbia.

The significance of standard reason codes can be illustrated using commissions. Depending on the carrier, numerous reasons and various descriptions are currently provided for commission transaction discrepancies, causing confusion. As a result of the DMWG’s efforts, there are now three core commission reason codes: incorrect commission, recall commission and invalid commission—all with standard definitions. This improvement to the commission-based debit memo process could help reveal the reasons behind these types of debit memos and guide where resources should be directed to reduce memo numbers.

“This is a great accomplishment by the DMWG, all due to the focus and hard work of its participants over the years,” said Shelly Younger, ARC’s manager of settlement services. “Our challenge now is to involve as many carriers as possible and map their existing memo reasons to the DMWG’s standards. If we get widespread commitment to the standards, debit memos will one day be no more than a minor inconvenience instead of the challenge it is now.”

The DMWG is comprised of representatives from stakeholders and other interested organizations from across the travel industry. Members include the eight airlines that issue the majority of debit memos, travel agencies ranging from sole proprietorships to mega-size, IATA, GDSs, ATPCO and ASTA.

About ARC:
ARC powers the U.S.-based travel industry with premier business solutions, travel agency accreditation services, process and financial management tools, and powerful data analytics. In 2014, ARC settled $89.6 billion worth of carrier ticket transactions for more than 9,400 travel agencies with 13,000 points of sale. By providing world-class business services and products, ARC enables participating agencies and 200 carriers to focus on what's important–increasing their revenue. Established in 1984, ARC is headquartered in Arlington, Virginia. For more information, please visit www.arccorp.com.