Cash is King: Why Your Profitable Travel Agency Might Run Dry Tomorrow

Here is the harsh reality for Indian travel businesses in 2026: You can be profitable and still go bankrupt. The culprit is cash flow velocity. The “Antravia Global Travel Finance Outlook” warns that most travel failures happen not due to lack of bookings, but because of the gap between paying the supplier and collecting from the client .

With rising interest rates, holding client money in a current account for 30 days is a loss. Moreover, cross-border payments are a nightmare. Due to RBI regulations and global sanctions (Russia, etc.), wire transfers can take weeks. However, the game-changer is the “Merchant of Record” model. Are you acting as an agent (passing payment to the airline) or the merchant (taking liability)? If a hotel in Dubai goes bust, and you were the merchant, you owe the refund—not the supplier. The Indian B2B sector must adopt virtual credit cards and faster reconciliation software. Don’t let your working capital sit idle. The winners in 2026 will be those who see their real cash position in real-time, not those with the highest booking volume.

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Profit is vanity, cash flow is sanity. With high Indian interest rates, holding client money for 30 days kills margins. Shift to “Agent” models where liability transfers instantly. Use virtual cards to extend supplier payment terms without hurting your working capital.