What is Airlines Reporting Corporation (ARC)?


Example entry (usage)	When a ticket is issued: The ARC number of the travel agency is recorded, linking the sale to the settlement system. When funds are transferred: ARC debits the agency's bank account and credits the airline's account for the ticket value.
Different from	GDS (Global Distribution System): Provides the content and booking interface. IATA BSP: The equivalent settlement system used in most countries outside the US.
Also known as	ARC
Branch	Travel industry infrastructure, payments & settlement
Common in	US-based airlines, travel agencies, and corporate travel programs

What Is ARC and Why Is it the Backbone of US Ticketing?

The Airlines Reporting Corporation (ARC) is a US-based organization that connects airlines and travel agencies to handle ticket reporting, settlement, and industry data.

This matters because when a travel agency or Travel Management Company (TMC) sells an airline ticket, ARC is the crucial "middle layer" that ensures the money and data are correctly moved between the agency and the airline. For example, when your TMC issues a ticket on a US airline, ARC helps verify the sale and makes sure the airline receives its share of the revenue.

In business travel and expense management, ARC operates entirely behind the scenes. Its stable system supports reliable ticketing, complex refunds, exchanges, and data integrity, which your company benefits from as fewer ticketing errors, smoother reissues, and better overall reporting on air spend.

The Three Core Functions of ARC

ARC's role is multifaceted, providing infrastructure, financial security, and intelligence to the entire US travel distribution chain.

1. Agency Accreditation

ARC approves and manages US travel agencies and TMCs that wish to issue airline tickets. This accreditation process requires agencies to meet financial standards, including bonding and operational requirements.

Trust Signal: Accreditation signals to airlines that an agency is legitimate and financially sound.
Unique Identifier: Agencies are assigned a unique ARC number used in all ticketing and reporting.

2. Settlement and Payment

ARC runs a financial clearing system to handle all sales transactions. This is often referred to as ARC settlement.

Sales Reporting: Agencies regularly (usually weekly) report all tickets, refunds, and exchanges to ARC.
Fund Transfer: ARC aggregates these sales, debits the agency's funds, and credits the corresponding airlines, ensuring correct and timely payment.

3. Data and Analytics

Because ARC collects detailed ticket data across all participating agencies and airlines, it is a key source of industry intelligence.

Industry Benchmarking: This data powers insights on fares, route volumes, and trends used by both airlines and large corporate buyers.
Reconciliation: It provides the standard transactional data used for accounting, audits, and performance tracking across the industry.

Practical Scenarios: How ARC Impacts Your Travel Program

Although invisible to the traveler, ARC is the foundation for managing ticketing and financial risk within your travel program.

Scenario 1: Standard Corporate Booking Flow
Your employee books a US-domestic trip via your TMC using your online booking tool (e.g., Navan Travel). ARC's Role: The TMC's ARC accreditation allows it to issue the ticket through the GDS. ARC then handles the financial settlement, ensuring the airline is correctly paid from the agency's accounts. Benefit: The process is reliable, and the airline honors the ticket without dispute.

Scenario 1: Standard Corporate Booking Flow

Your employee books a US-domestic trip via your TMC using your online booking tool (e.g., Navan Travel).

ARC's Role: The TMC's ARC accreditation allows it to issue the ticket through the GDS. ARC then handles the financial settlement, ensuring the airline is correctly paid from the agency's accounts.

Benefit: The process is reliable, and the airline honors the ticket without dispute.

Scenario 2: Processing a Complex Refund or Exchange
A traveler changes a flight, resulting in a ticket reissue and partial refund. ARC's Role: The TMC processes the reissue through the GDS. ARC receives the updated transaction, including the old ticket value, penalties, fare differences, and the refund amount. It then adjusts the settlement to the airline accordingly. Benefit: This clear, standardized process reduces disputes, minimizes accounting errors, and ensures faster credit processing compared to a non-standardized system.

Scenario 2: Processing a Complex Refund or Exchange

A traveler changes a flight, resulting in a ticket reissue and partial refund.

ARC's Role: The TMC processes the reissue through the GDS. ARC receives the updated transaction, including the old ticket value, penalties, fare differences, and the refund amount. It then adjusts the settlement to the airline accordingly.

Benefit: This clear, standardized process reduces disputes, minimizes accounting errors, and ensures faster credit processing compared to a non-standardized system.

Scenario 3: Industry and Corporate Analytics
A travel manager wants to benchmark the cost of a key US route against the industry average. ARC's Role: ARC's aggregated data (often provided via third-party analytics tools) shows average fares, volumes, and trends for that route. Benefit: Combined with internal data from your travel platform, the manager can objectively assess whether the corporate deals are competitive and effectively target future negotiations.

Scenario 3: Industry and Corporate Analytics

A travel manager wants to benchmark the cost of a key US route against the industry average.

ARC's Role: ARC's aggregated data (often provided via third-party analytics tools) shows average fares, volumes, and trends for that route.

Benefit: Combined with internal data from your travel platform, the manager can objectively assess whether the corporate deals are competitive and effectively target future negotiations.

For global corporate travel programs, it is important to distinguish ARC from the other infrastructure providers your TMC uses.

Aspect	ARC (Airlines Reporting Corporation)	IATA BSP (Billing and Settlement Plan)	GDS (Global Distribution System)
Geographic focus	Primarily United States market (US point-of-sale)	Worldwide (used in most countries outside the US)	Global content and distribution system
Main role	Settlement, financial clearing, and TMC accreditation	Settlement and financial clearing	Search, booking, and ticket issuance platform
User interface	None (back-end infrastructure)	None (back-end infrastructure)	Yes (the interface used by agents/TMCs to book)
Relationship	Handles the money after the ticket is issued via the GDS.	Handles the money after the ticket is issued via the GDS.	Handles the booking and data rail to the settlement system.

Why an ARC Supports a Stable Travel Program

Financial Stability: ARC's centralized system ensures airlines are paid reliably and agencies meet financial standards, providing a stable foundation for the air supply chain.
Data Integrity: Standardized reporting based on ARC settlement makes auditing and expense reconciliation cleaner for large corporations.
Accreditation as Trust: Working with an ARC-accredited TMC provides a baseline assurance of the agency's financial and operational capability.

Ready to ensure secure and auditable US ticketing? Get started.