New report finds £781m of consumer cash locked up in ‘refund credit’ from COVID-19 cancelled holidays
It also found that 43% of consumers surveyed who accepted an RCN were not offered a full cash refund when their holiday was cancelled - despite this being their legal right.
A new white paper exploring the impact on consumers as a result of holidays cancelled due to COVID-19 has been published today.
As YouGov data on the volume and value of Refund Credit Notes (RCNs) that are currently in circulation comes to light, the paper – which was commissioned by one of the UK’s largest holiday companies, On the Beach, and has been written by financial broadcaster, journalist and consumer expert, Georgie Frost – has revealed that a whopping £781.5 million of consumer cash is currently tied up in said RCNs, or “IOUs” with many travel companies.
It also shows that 43% of the consumers surveyed who accepted an RCN were not offered a full cash refund when their holiday was cancelled, despite this being their legal right.
As a result of the findings, On the Beach has set out five recommendations to help restore consumer trust in the industry – including a call for holiday companies to proactively contact their customers still holding RCNs from 2020 and offer them a full cash refund.
The beach holiday expert is also encouraging consumers currently holding an RCN but don’t want one, to contact their holiday provider now and ask for a full cash refund.
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It’s estimated that around 8.1 million people had a package holiday cancelled due to COVID-19.
Only half of those with a cancelled holidays received a full cash refund, and 851,000 (nearly 11%) accepted an RCN rather than cash, with the white paper outlining that over a million people with an RCN or rebooking were not offered a cash refund at the point of cancellation, even though this is a legal requirement.
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What’s more is that 52% of consumers surveyed were unaware of their legal right to cash.
Around 8.1 million people had a package holiday cancelled due to COVID-19 / Credit: Flickr
“It’s sad to think that a family who has saved for months or even years for their one summer holiday abroad has had to fight to get their money back, and in many cases have not been provided with full and transparent information of what they are entitled to when their holiday was cancelled.” said Anna Richardson, who has written a foreword for the white paper.
“Looking forward to your holiday is a massive part of the whole experience, but while there is still so much uncertainty and disruption, people are understandably lacking the confidence to plan and book again because they’re unsure of their rights if it gets cancelled.
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“The smoke and mirrors being used by some holiday companies is wrong.
“I urge people who had their holiday cancelled to use their right to a full cash refund and contact their travel provider today to ask for their cash.”
Simon Cooper – Chief Executive of On the Beach – added: “COVID-19 shocked the travel industry and it was challenging for everyone in the early months to manage the disruption and volume of cancellations.
“We’re over 14 months on now and yet the knock on impact of refunds on consumer confidence continues to affect the industry. Even now, only a third of people say they would consider booking a holiday to a green list destination, so we have to do something to restore their confidence.
“Without it the industry will continue to be in trouble.”
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OnTheBeach is encouraging consumers with an RCN to contact their holiday provider / Credit: PublicDomainImages
He continued: “There are millions of people still holding these IOUs, in some cases over a year later with very limited opportunity to go on holiday [and] this is all because some travel companies actively avoided offering cash and used their customers’ money for future holidays as cash flow. No one would expect to receive a loan for this long and pay no interest, so why should these companies continue to hold onto their customers’ money for future holidays?
“To begin regaining consumer confidence and trust in the industry, we want those people with refund credit notes from 2020 to be refunded in full.
“We’re also urging regulators to enforce that holiday companies and airlines hold their customers’ money in separate, regulated trust accounts until the date of travel.”
43% of consumers surveyed who accepted an RCN were not offered a full cash refund / Credit: Flickr
Why are RCNs not in the best interests of consumers?
Where consumers are not aware that RCNs can be exchanged for cash, RCNs hold them to one travel provider, which means that they don’t have their own cash in the bank to spend as and when they want, or put into a savings account earning interest.
RCNs remove the consumer’s ability to shop around for the best holiday deals and dates when they want to rebook.
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It’s also reported that 6% of all vouchers issued in the UK go completely unused.
What does the report recommend?
On the Beach has set out five recommendations in the white paper to help rebuild consumer confidence in the travel industry, which are:
Automatic Refunds: Automatically refund customers in cash when RCNs have been held for a year.
Proactive Contact: Customers holding RCNs from 2020 should be contacted proactively, notified of their rights and offered a full cash refund.
New RCNs Offered Fairly: Any new RCNs offered to customers who have holidays cancelled in the future must be accompanied with the alternative choice of a full cash refund, with equal prominence.
Financial Protection: Greater protections for customers’ money with ring-fenced trust accounts should be a requirement for all ATOL holders and airlines.
Greater Transparency: Regulators to report on the number and value of RCNs in circulation, allowing potential customers to make informed decisions on who to book future holidays with.
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You can find more information, and access advice and assistance regarding RCNs from OnTheBeach here.
Featured Image – Unsplash / Dan Gold
UK News
More than £2 million in compensation received by underpaid workers in the North West
Danny Jones
More than £2 million is said to have been dished out in compensation to workers in the North West alone, as the UK government is continuing to crack down on employers underpaying their staff.
Employees from nearly 500 different companies across the region have received the money they owed following a raft of fines in excess of £2.7 million.
Covering the likes of Greater Manchester and beyond, the companies responsible have been revealed by the government as part of the new Fair Work Agency (FWA), which is tasked with shoring up workers’ rights moving forward.
The FWA is part of Labour’s wider ‘Plan For Change’, and hopes not only to correctly reimburse those short-changed but also, with the clear threat of swift action, deter others from trying to do the same in the future.
Matthew Taylor CBE has been appointed Chair of the Fair Work Agency, a new body that will transform how employment rights are enforced across the UK.
How? By tackling exploitation, supporting businesses doing the right thing, and helping to build a fairer labour market. pic.twitter.com/duEeNlwDHr
— Department for Business and Trade (@biztradegovuk) October 14, 2025
Released publicly last Friday, 17 October, 80 companies that failed to properly pay approximately 19,000 workers in and around the North West have now been repaid by their employers.
Perhaps most concerningly is that the fines sweep across multiple sectors and sizes, from local independents and SME to well-known high street brands.
From April 2026 onwards, the updated Employment Rights Bill (which also includes the FWA) grants more powers to tackle employers underpaying workers and failing to fulfil both holiday and sick pay.
This announcement also comes after the National Minimum Wage rate was increased earlier this year, with millions getting a pay rise and those working full-time on the National Living Wage seeing their families supported by an extra £1,400 per year.
Under the ‘Make Work Pay’ initiative set out by the Labour Party, more than 15 million Brits are expected to benefit from the new measures.
Overall, roughly £6 million has been put back into the pockets of underpaid workers up and down the country following these fines, which are said to have totalled roughly £10.2m. The full list of companies in question can be seen HERE.
Speaking on the news, Employment Rights Minister Kate Dearden said: “This government is taking direct action to ensure workers get every penny they’ve earned, and to put an end to bad businesses undercutting good ones.
“We’re proud to have delivered a strong minimum wage, and enforcing it thoroughly is crucial in our mission to put pounds back in your pocket. I know this news will be welcomed by brilliant businesses across the country, those who know that happy, well-paid staff are at the heart of building a successful company.
“With our new Fair Work Agency and the coming Employment Rights Bill, this government is keeping our promise to Britain to make work pay again.”
If you fear you might be suffering from underpayment by your employer, you can check that your wages are correct online; alternatively, you can call the Acas helpline on 0300 123 1100 or contact their website for more information right HERE.
Salford Red Devils have been dropped from the Super League
Danny Jones
Salford Red Devils RLFC have been officially relegated and dropped from the next Betfred Super League season following months of uncertainty both on and off the field.
It’s a nightmare scenario for supporters, but not entirely surprising given their struggles of late.
Revealing the decision this week, the Super League announced that Salford Red Devils will not be competing in the top tier next term, with the upcoming adjusted campaign getting underway in 2026.
Confirming that their IMG grading had been reduced as expected in the wake of recent events, the Greater Manchester side shared an official statement with the fans on Thursday morning, 16 October.
The reaction has obviously been one of deep frustration from a fan base that has been put through the ringer over the past year or so.
Die-hard Red Devil, Andy Roberts, commented in the numerous replies underneath Salford’s post on X: “I’m sorry, but this statement is a complete disgrace. Patronising fans, ignoring the huge elephant in the room. RELEGATION!”
Even neutrals got involved, with one person writing: “I hope someone comes in and saves you. No gloating here, we’re all part of the RL [rugby league] family, and I’ve lost my club before – wouldn’t wish it on anyone. Best of luck getting sorted.”
Another added that he believes this “Has to be the worst piece of comms from any club ever. Might have been better to start with a ‘really sorry we won’t be part of Super League next season’ line.”
Most notably, their dismissal from the division for now has also made way for the return of Bradford Bulls, who haven’t featured in the tournament since 2014, ultimately limping towards liquidation and eventual relegation themselves. Safe to say Salfordians fear the same.
It’s also worth noting that Salford Red Devils’ relegation also comes in tandem with the Super League actually expanding in terms of participants, with 14 teams set to face off in 2026; a dozen are automatically included via the aforementioned gradings system.
The Bulls were restored to the ranks after finishing 10th in the overall IMG rankings, while SRDLFC’s 0.25 point reduction to their total score proved enough to see the Yorkshiremen take their place after more than a decade.
Another two of clubs are still waiting to be named in the roster for next year, with an independent selection panel scheduled to verify their picks this Friday, 17 October.
You can see the club’s ‘divisive’ (to say the least) statement in full HERE and, in the meantime, find out more on the latest twist in this unfortunate tale that went on somewhat behind the scenes down below.