Nowhere to go, Covid air pocket leaves flyers with forced vouchers

Both Indian and foreign airlines are refusing to refund cash

Visiting California was on Amrita’s mind since she got her first job in mid-2019. She saved and planned a Vegas trip. But with the coronavirus pandemic forcing India to cancel international flights, the ~42,500 she spent on the tickets, booked in December for travel in April, is stuck.

Etihad Airlines has refused to provide her a refund and has given her a voucher of equivalent amount that can be used till July 31 next year. But with the virus spread becoming severe in the US, Amrita is unsure of any international travel in the near future. She now spends 10 minutes daily trying to get a refund. “I call them. They’re robotic, keep repeating the same information, that Etihad has decided not to give refunds and offer a voucher,” said Amrita, 25. “They wouldn’t deviate from the repetition. They just say I could log a complaint but that wouldn’t get me a refund.”

Not just the international airlines, it’s the same story with the domestic carriers. Indian airlines, too, are refusing to refund cash and are giving credit that can be used later.

As airlines pocket millions owed to customers, people are questioning the objective of spending taxpayer’s money to bail out these airlines while they hold the same taxpayers at ransom.

Indian civil aviation regulation mandates airlines to offer passengers a refund if a flight is cancelled, with exceptions for circumstances like bad weather. “If you are informed of the flight cancellation less than two weeks before but up to 24 hours of the scheduled departure time, the airline must offer another flight or refund the ticket amount, as acceptable by you,” the Ministry of Civil Aviation’s passenger charter states.

“That happens during normal times... but lockdowns across countries have dissolved schedules for weeks, forcing airlines to park their fleets and guarding their cash as revenue withers. If forced to give refunds now, one or more than one airline will be out of business,” an airline executive said.

The official’s comment echoes the message airline trade group International Air Transport Association (IATA) sent on Friday, urging governments to relax regulations on cancellation refunds.

“We believe the best answer for both airlines and travel agents is for regulators to ease requirements for cash refunds and allow airlines to issue vouchers instead. This would remove the pressure on agents to issue cash refunds at a time when airlines are making decisions based on their own need to preserve cash,” IATA said.

Their customers though are taking to social media platforms to complain they can’t get their money back.

The Indian civil aviation regulator has also been flooded with complaints from passengers but the DGCA has not yet taken a call, fearing that mandating airlines for cash refunds will push the already stretched companies into bankruptcy.

“We are concerned about the situation. But, we have to take a balanced view regarding this, as we have to save both passengers and airlines,” a DGCA official said, adding India has still not agreed to IATA’S suggestion for vouchers instead of cash refunds.

A second airline executive, who also has ~25,000 pending with British Airways for a family vacation he had planned for May, said the best idea would be to give airlines a longer window to return the money. “Give a window of one year to reschedule. If the passenger still doesn’t, the money can be refunded after a year. Till then, the situation will probably improve, and airlines will have some cash buffer.”

But many, like Amrita, want their refunds back “as soon as possible”. Many want it back due to the same reason airlines want to keep the money — uncertain times.