Consumers who accepted refund credit notes with a July 31 expiry date should receive cash refunds now regardless of whether suppliers have refunded travel businesses, Abta has confirmed.
Abta director of financial protection and financial services John de Vial said: “We’re moving to ensuring members are honouring Refund Credit Note expiry dates, and the first of these is July 31. Delivery of the promised refund is going to be important to maintaining the integrity of Refund Credit Notes.”
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Speaking on an Elman Wall Covid-19 webinar, De Vial said: “Recovering refunds from suppliers is separate from refunding consumers. The end date for refunding the consumer has to be fulfilled.
“If the consumer will agree to have it extended, that is fine where it is done by agreement. The cruise industry is providing some very good incentives to consumers to do that. That is a commercial intervention. But if a customer wants their refund it does have to be honoured.”
De Vial insisted: “This is about balancing different rights and interests. No one wants to do anything other than refund consumers normally, [but] we recognised a lot of our members could not refund people within 14 days.
“If the regulator had enforced that, we would have seen multiple failures. Would that have served the consumer interest? I don’t think so. If we had multiple failures it would take even longer to refund consumers than with Thomas Cook, which took six months.
“We created a window [with Refund Credit Notes, but] these refunds will have to be made within that timescale [of expiry].”
De Vial suggested that “where companies have been refusing refunds, they are principally online booking platforms, the wedding sector for some reason, and hotel booking sites”.
Business Travel Association (BTA) chief executive Clive Wratten rejected the suggestion that airlines had been quicker to refund consumers direct than via intermediaries, saying: “I haven’t seen that. They have been pretty slow with everyone.”
Wratten told the webinar: “The BTA had more than £200 million in outstanding refunds at one point. We’ve started to see refunds from Lufthansa, KLM, Norwegian Air. The amount of refunds outstanding has shrunk significantly.”
As travel restarts, he said: “We don’t want refunds for travel now to go to the end of the queue. We want to be able to refund through the GDS.”
Airline refunds via GDSs have been largely suspended since March.
More: Travel agents warned chargebacks are ‘not going away’
Advice: Abta Refund Credit Notes explained
What you need to know about Chargebacks and Section 75 of the Consumer Credit Act
