According to the reports of several airlines in recent months, there are still hundreds of millions of pounds of unclaimed refund notes that are still being held following the mass number of flight cancellations throughout the Covid pandemic.
In 2020, as the Covid pandemic began, many travel businesses, and airlines specifically, were receiving millions of pounds worth of cancellations and requests for refunds from passengers that would no longer be able to travel. Many businesses faced the possibility of going bankrupt due to the sheer number of refunds that needed to be issued. To combat this flood of demand, many major airlines decided to encourage their passengers to accept refund notes instead of immediate cash refunds when the Covid restrictions first went into place.
Prior to the Covid pandemic, it was considered generally unusual for an airline to break out vouchers and refund notes in their results, or to prioritise them, leaving no comparison of the normal time to reclaim in contrast to the results on Covid era refund notes currently being held. However, many airlines are reporting a huge number of refund notes that are still left unclaimed as of 2022.
The International Airlines Group which controls many of the UK’s major airlines, reportedly still holds €911 million worth of unclaimed refund notes as of the 2022 annual results that were released on Friday the 24th of February. This has fallen from the €1.4 billion that was still being held at the end of 2021.
This accounts for a 35% reduction in the amount of refund notes being held, meaning that close to one-third of refund note holders used their notes to book flights in 2022, according to a newspaper report. The remaining passengers yet to reclaim their notes now only have until September 2023 to use their notes or risk losing them. If 2023 shows similar results to 2022, €600 million worth of refund notes could be lost.
Some major airlines have stated that they are making an active effort to encourage their passengers to use their refund credits before September in order to stop them from being lost.
In contrast, EasyJet has reported that the amount of unused refund credits that they still hold only accounts for 2% of ticket revenue, meaning “there is a very small proportion of customers who have not yet used their vouchers”. These numbers have fallen again during the peaks period following their previous report of £111 million in September of 2022.
So, if you’d like to learn more about how your consumers’ monies are protected with Protected Trust Services (PTS) and how we support excellent travel businesses, check out our pages. Or you can get in touch with the lovely PTS team by calling 0207 190 9988 or emailing us at email@example.com.