SynopsisGermany is significantly slashing costs for protecting package holidays against tour operator failures. Effective November 1, fees for the national travel security fund will halve, freeing up an estimated €70 million annually. This move aims to boost package tour competitiveness, with collateral requirements also reduced. Industry players view this as a positive initial step, advocating for further cuts to zero without compromising customer protection.AgenciesGermany will reduce the cost of protecting package holidays against tour operator insolvency by cutting fees and collateral for its national travel security fund, the country's main travel industry association said ‌on Thursday.German ⁠travel ⁠association DRV said levies paid into the German Travel Security Fund (DRSF) will be reduced to 0.25% of protected travel turnover from November 1, down from 0.5%The association said this step would free up about €70 million ($79.5 ⁠million) a ‌year and strengthen the competitiveness of package toursDRV said required collateral ⁠for the fund will also be lowered, calling it a one-off reduction of about €560 million in security postings, cutting capital costs and the need for bank guarantees or insurance coverTour operator TUI said the move was "a correct interim step," ‌and further reductions should follow quicklyTUI said that with around €1 billion already available to the ⁠fund for customer protection a cut to zero was possible without weakening customer protectionThe government created the fund in 2021 after the collapse of Thomas Cook to guarantee refunds if a tour operator fails. (Join our ETNRI WhatsApp channel for all the latest updates)...moreElevate your knowledge and leadership skills at a cost cheaper than your daily tea.Subscribe Now