The amount of money owed to consumers in refund credit notes (RCNs) is becoming “more and more dangerous” and risks “coming to a head”.
That is according to Krystene Bousfield, head of debt recovery at law firm Travlaw, who urged the CAA and Abta to give more notice of any extension to the deadlines for the issue and expiry of RCNs.
Bousfield told the Travel Weekly Future of Travel Spring Forum: “Everyone is looking forward to the day when travel opens up again and we’re out of the woods. But we’re not. People forget about all the RCNs businesses have been relying on.
“When we come to the RCN [expiry] deadline, huge sums are going to have to be paid back.”
The CAA has confirmed it is in talks with the government to extend both the March 31 deadline for issuing RCNs and their expiry date of September 30 (Travel Weekly, March 18).
Bousfield said: “The deadline keeps getting pushed back, which is helpful, but are we just prolonging the inevitable? In January we had clients asking, ‘Do we have to pay these monies on the deadline?’ Yes, you do.”
She warned: “People need to be ready for that. It’s not going to be a case of travel opens up on May 17 and we’re back to normal. There is going to be a transition – getting money in from bookings, setting it off against these RCNs. There is a huge balancing exercise. This is all going to come to a head.
“We keep having these flickers of hope. Everyone gets excited, we see a rush of bookings which is great, but if they don’t go ahead, it sets us back again. It gets more and more dangerous as we go on. We keep relying on RCNs, but they’re increasing in number.”
CAA group director of consumers and markets Paul Smith told the forum: “We’re conscious the two dates need to work together. We don’t want to end up in a situation where we concertina the need to use RCNs into a very short period.”
Abta confirmed it is also considering extending the deadlines. Director of membership and financial services John de Vial said: “We’re looking to align dates.”
Bousfield argued: “It’s frustrating Abta and the CAA leave it to the last minute to tell us ‘We’re going to extend the deadline’.”
