Setting Up a Travel Agency — Step-by-Step Guide to Starting Your Own Travel Business
Travel Trade · Part 2 · Module 10
Setting Up a Travel Agency — Step-by-Step Guide to Starting Your Own Travel Business
Starting a travel agency is one of the most accessible entrepreneurship opportunities in tourism. The investment is relatively low, the market is massive, and India’s 2.5 billion domestic trips annually create endless demand. Here is the complete roadmap to launching your own travel agency.
🚀 Steps to Set Up a Travel Agency
1
Market Research & Business Plan
Identify your target market, niche, location, and competition. Decide: outbound/inbound/domestic/MICE/speciality? Prepare a comprehensive business plan including market size, competition analysis, revenue projections, and cash flow forecasts. A startup travel agency must know its unique selling proposition (USP).
2
Choose Business Structure & Register
Decide: Sole Proprietorship / Partnership / Private Limited Company. Register with Registrar of Companies (ROC). Obtain: Certificate of Incorporation, Certificate for Commencement of Business, Business License, GST Registration, PAN Card.
3
Select Location & Office Setup
Minimum 250 sq ft office space (100 sq ft for hilly areas above 1000m). Preferably ground floor or first floor. Clean surroundings. Must be equipped with: telephone, fax, computer reservation system (GDS terminal), internet connection. Reception area and toilet facilities required.
4
Apply for IATA Accreditation
IATA (International Air Transport Association) accreditation allows your agency to issue airline tickets directly and earn commission. Requirements: financial guarantees, qualified staff, GDS installation, office space standards. Apply through IATA’s agency programme. Without IATA, you must sell through an IATA-accredited agency.
5
Apply for Ministry of Tourism Recognition
Voluntary but highly beneficial. Apply to: Director General of Tourism, Transport Bhawan, 1 Parliament Street, New Delhi. Requirements: ₹5 lakh capital, IATA approved, 250 sq ft office, 4 qualified staff (2 with tourism degree), 1 year operation after IATA approval. Fee: ₹5,000 (non-refundable Bank Draft).
6
Install GDS & Technology Systems
Install a GDS (Amadeus/Galileo/Sabre) for airline booking capability. Set up Property Management System for hotel bookings. Build website and mobile presence. Install accounting software. GDS training for all ticketing staff is mandatory.
7
Build Supplier Relationships
Sign agency agreements with airlines for commissions. Negotiate contracted rates with hotels. Register with cruise lines, car rental companies, insurance companies. Join TAAI or IATO for industry networking and collective bargaining power.
8
Hire & Train Staff
Minimum 4 qualified staff required for Ministry recognition. At least 2 must hold tourism diploma/degree from recognised university, IITTM, or AICTE-approved institution. In-charge must be trained in ticketing, itineraries, accommodation, currency, customs, and foreign languages.
9
Get RBI Authorisation for Forex
If you want to deal in foreign currency, apply to Reserve Bank of India under FEMA (Foreign Exchange Management Act). Only RBI-authorised agencies can exchange foreign currency — a significant additional revenue stream.
10
Launch & Market
Build website/mobile app. Create social media presence. Design your product catalogue (brochures, packages). Network with corporate clients, hotels, airlines. Consider FAM trips to build destination knowledge. Join industry events and trade fairs.
📋 Legal Documents Required
✓ Certificate of Incorporation
✓ Certificate for Commencement of Business
✓ Business License (Shops & Establishment Act)
✓ GST Registration
✓ IATA Accreditation Certificate
✓ Ministry of Tourism Recognition Certificate
✓ RBI Authorisation under FEMA (for forex)
✓ Professional Indemnity Insurance
✓ Online Privacy Policy (for website)
🎯 UGC NET Key Points — Module 10
◆ Office requirement: 250 sq ft (100 sq ft for hilly areas above 1000m)
◆ IATA accreditation: allows direct airline ticket issuance and commission earning
◆ Ministry of Tourism recognition: ₹5,000 fee, ₹5 lakh capital, IATA approved
◆ Staff: minimum 4 qualified, 2 must have tourism degree/diploma
◆ Forex: requires RBI authorisation under FEMA
◆ GDS options: Amadeus, Sabre, Galileo (Travelport), Worldspan
◆ BSP = Billing and Settlement Plan — financial settlement between agencies and airlines
◆ IITTM = Indian Institute of Tourism and Travel Management — accepted qualification
◆ TAAI (1951) + IATO (1982) = India’s key travel trade associations to join
◆ IATA accreditation: allows direct airline ticket issuance and commission earning
◆ Ministry of Tourism recognition: ₹5,000 fee, ₹5 lakh capital, IATA approved
◆ Staff: minimum 4 qualified, 2 must have tourism degree/diploma
◆ Forex: requires RBI authorisation under FEMA
◆ GDS options: Amadeus, Sabre, Galileo (Travelport), Worldspan
◆ BSP = Billing and Settlement Plan — financial settlement between agencies and airlines
◆ IITTM = Indian Institute of Tourism and Travel Management — accepted qualification
◆ TAAI (1951) + IATO (1982) = India’s key travel trade associations to join