Dash to spend £130m of holiday vouchers: Families must use credits for trips cancelled due to Covid by next September… or face losing them
Families are sitting on more than £130million of unused credit vouchers issued after their holidays were cancelled during the pandemic.
Travellers must now use these vouchers before they expire on September 30 next year or they will lose their money, the aviation watchdog has warned.
Ordinarily when a package holiday is cancelled, tour operators are required by law to refund customers within 14 dae.
But amid fears that scores of companies could go bust if they were forced to pay out during the Covid crisis, thousands of customers were pushed to accept credit notes instead.
Families are sitting on more than £130million of unused credit vouchers issued after their holidays were cancelled during the pandemic
This sparked outrage among consumer groups who were concerned holiday- makers could be left out of pocket if their firm later collapsed. The Civil Aviation Authority eventually intervened in July 2020 and pledged that all such credit notes would be covered under the Atol scheme, which ensures package holiday customers do not lose out if their firm goes under.
This meant customers had peace of mind that they would be able to exchange their voucher for a refund whatever happened. But this extra cover will now end at midnight on December 19, the CAA has said.
After this date, firms should only offer customers a refund if their trip is cancelled. Anyone who accepts a voucher in lieu of a refund from then on will not be protected.
Industry sources said it was thought the travel industry had become too reliant on credit notes. Now travel is picking up again, they should no longer be using customer cash to stay afloat.
Extra cover will now end at midnight on December 19, the CAA has said (File image)
The CAA reported an almost 300 per cent increase in airline passenger numbers in the third quarter of 2021 compared with the previous three months – although this is still a 72 per cent fall compared with the same period in 2019. Customers are now being urged to use their vouchers to book a new holiday, or trade them in for a cash refund. But there are fears that an avalanche of refund requests could put firms still struggling to recover at risk.
Many holidaymakers may also be holding unspent vouchers for cancelled flights, which are not protected by the Atol scheme. They are also being advised to check expiry dates to avoid losing out. Martyn James, of the complaints service Resolver, gesê: ‘Travel firms need to stop using customers as cash cows to prop up their businesses when they should be… offering them a cash refund.
‘Regulators must keep a close eye on firms to ensure customers who helped the industry by accepting vouchers do not lose out.’
Resolver estimates it has received about 40,000 complaints about vouchers in the past two years.
Michael Budge, head of Atol at the CAA, gesê: ‘Refund credit notes have been a fantastic tool to reassure consumers and support the industry.
‘The decision to end the scheme reflects the changing of international travel restrictions, with significantly increased demand from consumers…due to the opening up of more destinations.’