FG Mulls Ticket Sales to Recover Airlines’ Debts

He said the initiative was designed to help “eradicate the point of financial conflicts between government and operating domestic carriers.”

The Federal Government is considering a proposal that would allow domestic airlines to settle outstanding debts owed to aviation agencies through future ticket sales rather than immediate cash payments.

The proposal, developed by QuickAir Networks Limited, was presented to officials of the Ministry of Aviation and Aerospace Development on July 22 under the company’s National Ticket-for-Cash Aviation Revenue Recovery Programme.

Under the proposed arrangement, airlines would create digital wallets equivalent to the value of their agreed outstanding debts to agencies including the Nigerian Civil Aviation Authority (NCAA), Nigerian Airspace Management Agency (NAMA) and Federal Airports Authority of Nigeria (FAAN).

The funds in the wallets would then be converted into seat inventory and distributed through QuickAir’s platform to travel agencies, corporate organisations and government institutions. Proceeds from the ticket sales would subsequently be used to settle the airlines’ obligations to the agencies.

Leading the presentation, Segun Oyebolu said the arrangement would offer airlines a flexible alternative to immediate cash payments at a time when rising operating costs are putting significant pressure on their finances.

He said the proposed system would, however, only be effective if airlines stopped accumulating fresh debts, suggesting an automated mechanism through which government charges would be deducted from ticket sales as transactions occur.

Oyebolu said about 70 percent of domestic flight tickets are sold online, making digital settlement a viable option for recovering government revenues.

Under the proposed system, he said, five percent of ticket sales would be automatically remitted to the designated NCAA account, while the remaining 95 percent would be transferred to the airline.

He added that the automated settlement would be completed within microseconds and would not cause any noticeable delay in airlines receiving their proceeds.

QuickAir Ready for Deployment

During the technical session, QuickAir demonstrated its existing ticket distribution and settlement platform, which it said could connect with the systems of Nigeria’s 14 active domestic airlines.

The company also showcased its accounting backend, including transaction records and revenue generated through its platform.

Oyebolu said QuickAir was ready to deploy the infrastructure once airlines operating under the Airline Operators of Nigeria (AON) agreed to the proposed arrangement.

The Ministry of Aviation and Aerospace Development had, in a letter dated May 29, invited the company to present the proposal following its submission on the national ticket-for-cash aviation revenue recovery programme.

QuickAir Chairman, Suleiman Ibrahim, said the company was prepared to work with the ministry and other aviation stakeholders to address the recurring financial disputes between government agencies and domestic airlines.

He said the initiative was designed to help “eradicate the point of financial conflicts between government and operating domestic carriers.”