Travel Agencies Must Have Bank Guarantee Of RM250,000 To Operate - MATA

KUALA LUMPUR, Jan 22 (Bernama) -- All travel agencies, particularly Umrah operators, must have a bank guarantee to ensure the quality of the services offered and safeguard the welfare of pilgrims.

Malaysian Association of Tour Agency (MATA) president Datuk Seri Dr Mohd Khalid Harun said this is in line with the Ministry of Tourism, Arts and Culture’s (MOTAC) proposal to require Umrah operators to possess a minimum bank guarantee of RM250,000.

“This requirement has been around for some time, but many travel agencies have requested that it is not enforced. However, due to the increasing number of consumer fraud, especially involving Umrah and Hajj packages, if a company doesn’t have a capital of RM250,000, it should not operate.

“When the government mandates the RM250,000 bank guarantee, MATA fully supports this decision to ensure that all travel agencies offering outbound packages have the required bank guarantee,” he said.

He added that agencies offering outbound travel packages inherently require substantial funds to cover initial costs in case of unforeseen incidents.

“I have been an operator for 30 years. When my pilgrims were stranded in Cairo and one of them passed away, immediate funds were needed to handle the repatriation of the remains. Waiting for insurance payouts takes time, so operators must manage these initial costs themselves,” he explained.

Recently, MOTAC announced that it is reviewing the implementation of regulations requiring Umrah operators to have a minimum bank guarantee of RM250,000.

The bank guarantee for Umrah operators is a requirement in the Tourism Industry Regulations under Act 482.

This measure is part of the improvements to licensing requirements for outbound travel businesses offering Umrah or pilgrimage packages.

Recently, it was estimated that 379 pilgrims who bought packages from a well-known Umrah operator were stranded and unable to travel to the holy land.

-- BERNAMA