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.
ADVERTISEMENT
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.
ADVERTISEMENT
What’s more is that 52% of consumers surveyed were unaware of their legal right to cash.
“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.
ADVERTISEMENT
“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.”
ADVERTISEMENT
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.”
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.
ADVERTISEMENT
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.
___
You can find more information, and access advice and assistance regarding RCNs from OnTheBeach here.
Featured Image – Unsplash / Dan Gold
UK News
FA Cup final confirmed for 3pm kick-off time as Metropolitan Police stress safety for fans
Danny Jones
The start time for the 2023/24 FA Cup final has officially been confirmed with holders Manchester City and challengers Manchester United set to kick off at 3pm on Saturday, 25 May.
It’s a Manc final for the second year running and yet another Manchester Derby this year as City beat Chelsea on penalties to try and defend one of their trophies from last season and Man United did just about enough to scrape through against Coventry City this past weekend.
Logistics and travel arrangements for the conclusion of last year’s FA Cup proved problematic, with the Metropolitan Police stressing that they needed the schedule brought forward to try and help curb crowd trouble – the first time the final had been reverted back to a traditional 3pm start since 2011.
Kick-off times for the knockout tournament have varied for the last three finals, having taken place at 4:45 and 5:15pm in the two years prior to 2023’s first-ever all-Manchester final, but it looks as though the same rationale has been put in place once again.
As per an official statement by the FA, the final has now been officially confirmed as 3pm BST which has been agreed with local authorities, members of the Safety Advisory Group and broadcasters, as well as with the clubs who must take the time needed for fans to travel to and from Wembley into consideration.
While pockets of fighting broke out before and after the game last year, it was deemed that this time would still be the best kick-off time for all parties involved and there will, of course, be an increased police presence in London for the game next month.
Although prioritising safety comes as welcome news, it’ll no doubt prove to be a blow to broadcasters who prefer later kick-offs when eyeing up peak audience numbers; the game is also set to clash with ITV’s coverage of the rugby as the Investec Champions Cup final is also due to start at 2:45pm.
With last season’s historic FA Cup final being the first time the two sides had met in the final in the entire history of the oldest competition in all of football, it rounded off a massive year of viewing figures for the tournament which has continued to hit record numbers in 2024.
The game will once again be shown live on BBC One, BBC iPlayer and ITV1; ITVX, UTV, as well as STV, and there will no doubt be huge screenings of the game all over Greater Manchester, where an increased police presence is also expected.
Peter Kay’s gigs at Co-op Live have been postponed as the arena admits it’s not ready for opening act
Danny Jones
Just a day before the venue was set to welcome its very first act, Co-op Live has announced that arena opener Peter Kay’s gigs have unfortunately been cancelledand postponed until later this month.
Both of Peter Kay‘s highly-anticipated shows have ultimately had to be called off after Co-op Live revealed that the brand-new entertainment venue is simply not ready to welcome guests just yet, with work still to be completed on key areas of the building, namely power supply issues.
Issuing a regretful statement on social media, the arena has confirmed that the shows will now be rescheduled to Monday and Tuesday, 29-30 April.
Addressing the situation online, Co-op Live said: “Following our first test event on Saturday, regretfully we have made the difficult decision to reschedule our two opening performances by Peter Kay…
“It is critical to ensure we have a consistent total power supply to our fully electric sustainable venue, the completion of which is a few days behind. Rescheduling gives us the extra time we need to continue testing thoroughly.
“This is vital to satisfy the rigorous set of guidelines and protocols that are necessary for a venue of this size. Peter Kay has very graciously agreed to perform his record-breaking comedy at Co-op Live on 29 (rescheduled from 23) and 30 (rescheduled from 24) April 2024.
“All tickets remain valid and ticket holders will be contacted by their point of purchase. Refunds will be available for those who can no longer attend. We are very sorry for the inconvenience that this change will undoubtedly cause for some.” Safe to say many of those looking forward to the show have been left frustrated.
Speaking to The Manc, a Stockport gig-goer who had tickets said they had to find out via social media and that her group had still received no email notifying them about the cancellation, adding, “We just logged into the app to find the date on our tickets had been changed to next Monday”.
As for the beloved Bolton-born stand-up and British comedy legend himself, Kay added: “I’m truly gutted as I know how disappointing this will be for everyone with tickets, but obviously it’s a brand-new venue and it’s important that everything is finished and safe for full capacity audiences.
“Fortunately, we’ve been able to reschedule the shows to next week, (I’ll have to miss my Bums & Tums class) but hopefully I’ll see you then.”
The venue also went on to assure that they will still be hosting The Black Keys on 27 April in the lower bowl with 10k fans as planned and will continue to test the resilience of the venue and its operations for the time being.
They also reminded fans who previously missed out on tickets that due to dates being moved, tickets may now become available.