My Barbados Blog

Delta Airlines, and its credit card processor can't reach terms on their contact, and this may halt Visa and MasterCard processing by the major airline.

All of our major airlines are, and have been in serious financial trouble. American, United and Delta continue operating in fantasy land as if these problems don't exist, and they just keep getting deeper in debt . . kind of like our present government policies.

The high cost of fuel has made a bad situation even worse, and Delta finds itself in a disturbing position in not having enough upfront cash to cover all those customers who have already bought their airline tickets for future vacations. Credit card processing companies demand enough up front cash reserves to cover credit card processing, and Delta does not have the cash reserves.

Perhaps another quick fix will take care of this particular issue. All the major airlines have resorted to bailouts, loans, mergers and other means to keep flying, but bills eventually have to be paid, or you must close your business.

Can you imagine an airline that would be unable to take your Visa or MasterCard?

WASHINGTON -- Delta is having difficulty reaching terms on a contract with a new processor for Visa and MasterCard transactions.

The contract with the airline’s current Visa and MasterCard processor expires Aug. 29, and the potential new processor is conditioning a contract on Delta providing a “significant cash reserve” for tickets purchased but not yet flown, Delta said.

In an Aug. 9 filing with the Securities and Exchange Commission, Delta said it is “ exploring alternatives to offset a portion of the cash reserve, but there can be no assurance whether or when it can implement any such alternative.”

Without a processing contract, Delta would not be able to accept those credit cards for payment.

To contact reporter Andrew Compart, send e-mail to acompart@travelweekly.com.