Your Guide for Landing a Travel Agency Merchant Account

Merchant services for travel agencies can be challenging to obtain. Learn how you can procure them and thrive in this enormous industry by checking out our comprehensive guide – covering things like commonly asked questions, statistics, tips, and resources.

Table of Contents

State of the Travel Agency Industry
Important Statistics & Data
Relevant Laws & Codes
Struggles Facing Travel Agencies
Common Questions Travel Agency Merchants Ask
Tips For Getting Your Merchant Account Approved
Additional Industry Information

The travel industry singlehandedly accounts for a whopping 10.2% of the gross domestic product worldwide. Given the industry’s enormous size, you might expect that travel agencies would have no problem securing a merchant account with a payment provider, but you’d be wrong. It’s actually quite difficult for travel agencies to secure payment processing because travel agencies are considered high risk merchants.

There’s a silver lining, though. At Motile.com, we’re able to help 95.7% of high risk businesses — and we specialize in travel payment solutions.

Set Up Your Travel Merchant Account

Keep reading below if you’re ready to carve out your own space in the ever-growing world of travel business.

1. State of the Travel Agency Industry

Travel has rebounded past its pre-pandemic peak and kept climbing, and the US remains the world’s largest market (current figures are in the next section). For a travel business, that demand is real, but so is the payment risk that comes with selling trips customers take weeks or months later.

That is the tension this guide addresses: a growing, high-value market where processors stay cautious because money changes hands long before the service is delivered. Get your compliance, licensing, and billing right, and you turn a high-risk label into a stable, approvable account.

2. Key Statistics

Travel is one of the world’s largest industries. Global travel and tourism contributed $11.6 trillion to GDP in 2025, about 9.8% of the global economy (WTTC, 2025). The US is the single largest market, contributing $2.63 trillion to GDP, with domestic visitor spending around $1.54 trillion (WTTC, 2025).

Online booking is where much of the growth sits: the online travel booking market is estimated near $660 billion in 2025 and forecast to reach about $1.13 trillion by 2030 (Grand View Research). Analyst estimates vary, so treat these as a range. In the US, the Bureau of Labor Statistics counted 58,250 employed travel agents in 2024, excluding the many self-employed and hosted advisors (BLS).

3. Relevant Laws & Codes

London clock tower, parliament building — Travel laws vary by country – understand the ones relevant to you.

United States

In the U.S., there are no federal regulations specifically targeting the travel agency industry. However, there are currently five U.S. states that enforce “seller of travel” laws — California, Florida, Washington, Iowa, and Hawaii. These laws are extraterritorial, meaning they apply not just to travel agency operators within those states, but also to anyone who sells to residents of those states.

In addition to these seller-of-travel laws, individual state and local governments typically have their own general regulations and provisions that impact travel agencies. Laws about advertising, misrepresentation, disclosures, claim forms, and delivery of tickets or vouchers are common across many jurisdictions. For example, travel agencies can expect regulatory action from the following sources:

State consumer protection statutes
Federal and state telemarketing statutes
State tourism boards
The U.S. Federal Trade Commission (FTC)
The U.S. Department of Transportation (DOT)
State and federal case law

Canada

Laws in Canada are a bit more complex, particularly if you’re located in the province of Ontario. The Travel Industry Act sets regulations for all travel retailers and wholesalers operating in Ontario, and the Travel Industry Council of Ontario (TICO) monitors compliance with the requirements for registration, annual recertification, financial obligations, and advertising standards. Quebec and British Columbia also impose their own sets of regulations on travel agencies.

United Kingdom

Travel agencies in the U.K. are subject to the 1992 Package Travel Regulations. Furthermore, to sell air travel, you will need to obtain Air Travel Organisers Licensing (ATOL), which is issued by the Civil Aviation Authority. Recent legislation from the European Union, the package travel directive, provides additional protections for holiday travelers that U.K. travel agencies must observe, at least until Brexit takes effect.

Industry Codes (SIC, NAICS, & MCC)

Travel agencies usually identify by the Standard Industrial Classification (SIC) code 4724 (Travel Agencies). Extended SIC codes are as follows:

472401: Tourist Information
472402: Travel Agencies & Bureaus
472403: Travel Consultants
472404: Trains-ticket Agencies
472405: Golf Vacation Packages
472406: Cruises
472407: Destination Management
472408: Tours-sound Tape Systems
472409: Viatical Benefits
472410: Wedding Honeymoon Planners

Incidentally, Priceline/Booking Holdings Inc. identifies with SIC code 7389 (Business Services, Not Elsewhere Classified), and Expedia uses 4700 (Transportation Services).

Travel agencies also use the North American Industry Classification System (NAICS) code 561510 (Travel Agencies) and the Merchant Category Code (MCC) 4722 (Travel Agencies, Tour Operators).

You can browse SIC codes here and NAICS codes here. Here’s a list of MCC Codes from the IRS.

Seller of Travel Laws: The Compliance Step That Gates Your Merchant Account

Most travel pages treat licensing and payments as separate worlds. They are not. Four US states run active Seller of Travel registration regimes, and acquirers increasingly ask for proof of registration before approving a travel merchant account.

California (Attorney General Seller of Travel Program): registration plus a trust account or bond and consumer disclosures.
Florida (FDACS): registration and a surety bond, with some exemptions.
Washington (Department of Licensing): registration and a bond or trust account.
Hawaii (DCCA): a travel-agency trust account or bond, registered biennially.

Key point: these laws apply based on where your customer lives, not where you operate. Sell to a California resident and California’s rules can apply even if your agency sits in another state.

IATA, ARC, and CLIA: Accreditation That Helps You Get Approved

Accreditation signals legitimacy to underwriters and can improve pricing. In brief: ARC lets US agencies issue airline tickets, IATA/IATAN is the international equivalent, and CLIA lets you sell cruises and earn cruise commissions (accreditation overview). Holding one or more, alongside Seller of Travel registration, is exactly the evidence of consumer protection acquirers look for.

4. Struggles Facing a Travel Agencies (and solutions)

Overhead view of a map, coffee and pen hovering over. Travel concept — Are you prepared for the challenges of running a travel business?

Problem #1: Chargebacks

When a customer disputes a transaction, a chargeback is generally the end result. Too many of them will bump your ratio too high (1%+) — a major red flag for most payment processors. You can read more about chargebacks here.

Travel agencies are subject to a higher-than-average number of chargebacks than the average merchant. In this case, they to happen because people book their trips well in advance and try to cancel when something comes up unexpectedly. If a customer is unable to cancel and get a refund, they might take the next step and try disputing the charge.

Another source of chargebacks is fraudulent activity. It’s especially challenging for OTAs to monitor fraud because of the sheer number of transactions they process every day — airline tickets, for example, might have route combinations numbering in the millions upon millions.

Given that most purchases are big ticket items, payment processors are understandably hesitant to provide merchant services for travel agencies. There are things you can do to manage your chargeback ratio, though.

Solutions

First of all, do everything in your power to provide outstanding customer service. If possible, offer 24/7 support.
Make it an agency policy to give refunds. It might be expensive, but it’s better than not having a travel agency merchant account due to a high chargeback ratio.
Partner with a company of processing veterans like Motile, who can help you manage disputes and prevent chargebacks. We’ve built a solid network of payment processors over the years, and we can offer you a variety of solutions to help your travel agency succeed

Problem #2: Application Denials

Since travel agencies are considered high risk merchants, your options for payment processing are somewhat limited. Most mainstream banks and processors won’t even bother with a merchant account for a travel agency as a matter of policy. Even aggregators like PayPal tend to exercise caution when dealing with businesses in the travel industry.

Solutions

Make sure you’re presenting a completely transparent and consistent business plan, website, and customer service track record when applying for a high risk merchant account.
Keep careful records of all transactions and maintain a clean payment processing history.
Keep your personal credit as high as possible. Having great credit yourself sends a strong, positive signal to payment processors who are considering extending their services to your business.

Problem #3: The Big Dogs

If you’re reading this article, chances are you’re a small startup or a home-based travel agency, and you’re looking at a market dominated by Expedia, Priceline, and a few others. Some of these OTAs are so big that fighting them on price is impossible.

But while OTAs are able to capitalize on volume and accessibility, sometimes the sheer number of options they present is overwhelming for customers – causing them to seek guidance elsewhere. OTAs simply can’t offer the same kind of personalized service as traditional agencies.

Solutions

Outdo the OTAs by offering a more authentic, personal experience to impress customers and keep them coming back for more.
Focus on a niche, whether that’s a particular destination, a specific audience segment, or a single type of travel.
Provide a smooth booking experience online. Customers should be able to search and book travel without any user experience issues.
Offer all-star customer service, ideally with 24/7 access.

Problem #4: Regulatory Headaches

Because travel agencies often work across borders (both domestic and international ones), it can get complicated to ensure you’re abiding by all the relevant rules and regulations. Depending on where you operate, you could be subject to a wide variety of legislation from different states or provinces. It might seem a bit tricky to manage, but there are things you can do:

Solutions

Operate under a host agency that already has the legal framework sorted out for you.
Work with a travel law agency to be certain that you’re complying with all state, local, and international regulations applicable to your business.
Join a trade association like the American Society of Travel Agents. Trade associations typically have resources that can help you navigate legal and regulatory areas. ASTA, for instance, offers a course called Legal Overview in Travel Agency Operations ($49 for members).
Carry professional liability insurance to protect yourself in the event of a claim made against you for errors in business activities or services.
Make sure you’re up to speed on your responsibilities and legal duties as a travel agent.

5. Common Questions Travel Agency Merchants Ask

Dapper looking gentleman inquisitively looking at his laptop — There’s no such thing as a bad question (supposedly).

Question #1: Why did my travel agency merchant account get frozen or closed?

Was your travel agency merchant account suddenly closed or its funds frozen? There are a few things that might be going on:

Your chargeback ratio surpassed and stayed higher than 1%.
Your payment processor changed its policies regarding high risk merchants.
You added an international account, which might not be protected by the same regulations as domestic accounts and is therefore considered a red flag.

Question #2: What can I do to lower my rates and increase my volume?

As a high risk merchant, it’s normal to see higher rates and lower volumes on your account, at least during your initial trial period. This is the case because payment processors are trying to account for the additional risk posed by travel agencies. It’s possible to get lower rates and higher volumes, but unfortunately it’s just going to take some time.

Most payment processors will want to see signs of stability and growth over time. In general, you’ll probably want to shoot for the following:

3-6 months of successful payment processing
Predictable transactions
Steadily growing volume
Stable account balance

Question #3: How do I get a travel merchant account?

Opening a bank account is a matter of shopping around until you find a high risk payment processor that’s willing to work with you. To improve your chances, plan to be as transparent as possible in your application. Show a solid history of successfully processing payments and be able to explain any chargebacks you’ve had to deal with.

If you don’t have a lengthy business history or you’re just getting started, be sure to outline as much information as possible in your application – your plans for marketing, customer service strategy, website security measures, processing volume, and other relevant details.

At Motile, we understand the unique needs of the travel agency industry, and we offer multiple solutions with competitive rates, including credit card processing, debit card processing, and Automated Clearing House (ACH) transactions.

Why do processors classify travel agencies and tour operators as high risk?

Because customers pay well before they travel, the processor carries the liability for months. Cancellations, supplier failures, and refund disputes all land as chargebacks, so travel is treated as high-risk regardless of how well you run it.

How much reserve should a travel agency expect, and how is a rolling reserve released?

Reserves are common and often higher than other verticals because of future-delivery exposure. A rolling reserve holds a share of each batch and releases it on a schedule. The percentage and hold are negotiated against your booking-to-travel window and history, and should be in writing.

Do I need Seller of Travel registration to get approved?

If you sell to residents of California, Florida, Washington, or Hawaii, you generally must register there, and acquirers increasingly ask for proof before approval. Registration is both a legal requirement and an approval advantage.

Does an IATA, ARC, or CLIA number help me get approved or lower my rates?

Yes. Accreditation signals legitimacy and consumer protection to underwriters, which can speed approval and improve pricing.

What is the Visa VAMP threshold and how does the April 2026 drop to 1.5% affect me?

VAMP is Visa’s dispute-monitoring ratio. The merchant “excessive” threshold tightens from 2.2% to 1.5% on April 1, 2026, so travel merchants, who already see high disputes, have less room for error and should invest in cancellation clarity and chargeback tools.

How should I handle deposits and final balance payments?

Use split billing: a deposit now and the balance closer to departure, with card-on-file or payment links. Keep funding timelines in writing so a large final-payment batch does not trigger a reserve spike.

What documents do underwriters want from a travel business?

A published refund and cancellation policy, proof of Seller of Travel registration and any IATA/ARC/CLIA accreditation, business registration, and prior processing statements if you have them.

What happens to my payments if an airline or supplier fails before my customers travel?

Those bookings often become chargebacks, which is exactly the exposure reserves protect against. Clear supplier documentation, travel-protection options, and proactive communication reduce the damage.

6. Tips For Getting Your Merchant Account Approved

Young woman points on a colorful map, travel concept — A steady bank account helps all SMB owners rest easier.

Tip #1: Be Transparent

Transparency goes a long way when you’re a high risk merchant. With travel agencies, it’s essential to be completely open and honest about what you’re offering your customers — because if you embellish your travel packages, that’s when the chargebacks start rolling in.

You also don’t want to be embellishing anything when it comes to your finances. If a payment processor notices anything suspicious or unusual, they’ll likely just shut down your account without warning.

Tip #2: Join a Trade Association

Besides boosting professional pride, joining a trade association can improve your appeal to potential customers as well as payment processors. The American Society of Travel Agents, the Association of Retail Travel Agents, the United States Tour Operators Association, and the U.S. Travel Association are just a few examples of associations in the U.S. In addition, there are various certificate programs you can pursue to give yourself an edge as a high risk merchant.

Tip #3: Establish a Good Financial Track Record

It will be difficult to get a travel merchant account unless you can show that your finances are in decent shape. Perhaps you already have an immaculate history, but if not, you can still prove yourself during a trial period when you sign up with a high risk payment processor. As discussed above, you’ll typically need to show 3-6 months of successful processing as well as a stable balance reflecting steady growth and predictable transactions.

Tip #4: Don’t Get Too Attached to One Payment Processor

As a travel agency, you’re probably already well aware of how quickly things can change with a payment processor. High risk merchants tend to have trouble with steady relationships, but Motile can set you up with the best travel agency merchant account. We offer a wide variety of payment processing options, and our partners know what they’re getting into with travel agencies — so you can count on a stable relationship.

Go ahead, sign up and give us a shot today!

Why Travel Gets High Reserves (and How to Manage Them)

Travel is high-risk for one structural reason: the long gap between payment and delivery. A customer pays today and travels weeks or months later, so the processor carries the liability for that entire window. If a trip is cancelled or a supplier fails, the chargeback lands on the acquirer, not just you. A reserve is the acquirer’s cushion against that outstanding future-delivery liability, which is why travel reserves tend to run higher than other verticals.

Reserves come as rolling (a share of each batch held and released on a schedule), capped (held to a set amount), or upfront. The percentage and hold period are negotiated against your booking-to-travel window, average ticket, and history, and should be disclosed in writing before you sign. The tighter your booking-to-travel window, the lower the exposure.

Deposits, Final Payments, and Split Billing

Travel rarely bills once. A deposit now plus a balance charged closer to departure means part of your liability stays open for months. Your merchant account needs to support split payments, card-on-file and MOTO, and payment links, and your funding timelines should be in writing so a large final-payment batch does not trigger a reserve spike.

Staying Under Visa’s Dispute Threshold (VAMP)

Because travel dispute rates already skew high, Visa’s VAMP threshold is a survival number. The merchant “excessive” ratio drops from 2.2% to 1.5%, effective April 1, 2026 (Merchant Risk Council). Keep disputes below it with a clear billing descriptor, a published cancellation policy, proactive refunds when a trip changes, and chargeback alerts and representment. Supplier-failure disputes are the hardest to control, so documentation of every booking is your defense.

The Travel Merchant Risk-Tier Rubric: Where Does Your Business Sit?

Factor	Lower risk	Higher risk
Booking-to-travel window	Short lead times, near-term travel	Long lead times, far-future travel
Accreditation and licensing	IATA/ARC/CLIA plus Seller of Travel registration	None, or selling into states without registering
Refund and cancellation policy	Clear, published, honored	Vague or hard to find
Average ticket	Moderate	Very high-value card-not-present bookings
Dispute history	Low and documented	Elevated or unknown
Processing history	Prior clean statements	Prior termination, on MATCH/TMF

Every row you can move to the left column lowers your reserve, your rate, and your odds of a decline.

7. Additional Travel Agency Industry Information

American Society of Travel Agents

Founded in 1931, the American Society of Travel Agents provides advocacy, research, education, a daily newsletter, and more for U.S. travel agents and travel suppliers.

Association of Retail Travel Agents

The Association of Retail Travel Agents was founded in 1963 and represents small- and medium-sized agencies in North America. They offer advocacy, mentoring, training, a daily newsletter, and more.

United States Tour Operators Association

The United States Tour Operators Association was founded in 1972 to promote integrity and professionalism among tour operators. Of note is its $1 Million Travelers Assistance Program, which requires members to set aside funds to protect consumers.

U.S. Travel Association

Since 1941, the U.S. Travel Association has promoted, educated, and advocated for the benefit of all involved in the U.S. travel industry. They host a variety of events and programs to support their overall mission of increasing travel to and within the U.S.