People whose flights have been cancelled during the coronavirus crisis may be able to get their money back from their credit card provider if the airline refuses to refund them.
However, passengers are not getting consistent advice from banks on whether credit card claims will be honoured. And some customers say that their bank has told them it won’t help.
The law – Section 75 legislation – says that credit card providers may be liable when a product or service is not provided, if you’ve paid more than £100 and less than £30,000.
But it may not be enough if you simply can’t get hold of your airline, or it is being evasive. Our experts think a section 75 claim is only worth trying if your airline clearly states that it will not refund you.
Banks refusing credit card claims
Ryanair passenger, Laura Smith, says she tried claiming a refund from the airline, but didn’t receive a response. When she tried calling her card provider, M&S Bank, she was told that Ryanair was not in breach of contract and it was unable to help with a claim.
It was only after we got in touch with M&S that it said it may be able to help in some circumstances. We’ve asked Ryanair whether it will refund her and are awaiting its response.
Another passenger, Calum Chace, tried to get a refund from easyJet, but after failing to do so he turned to his credit card provider, Amazon.
He says: ‘I had a conversation with the call centre adviser and she told me categorically that they were instructed at the start of the coronavirus crisis to insist customers negotiate exclusively with the vendor.’
We asked Amazon if this was the case. It told us that it was investigating, but that it may be New Day, the issuing bank for the Amazon card, that would be responsible for any claim.
The law on credit card refunds
On the face of it, the law seems clear for those who pay for a service, on a credit card, that costs more than £100 and less than £30,000. When a company is in breach of contract and doesn’t provide a refund, the credit card company is equally liable. You’re able to claim the money back from the card provider, which will then chase the company that should have supplied you with the service.
But it’s unclear whether airlines cancelling flights constitutes a breach of contract. Their terms and conditions are carefully worded, and allow them a great deal of leeway in terms of changing schedules and cancelling flights.
How to make a claim
Which? Legal is advising members that it’s worth trying to get a refund from your credit card, but only when airlines are clearly and unambiguously refusing to provide a refund.
Some banks have supported this view. M&S Bank told us: ‘In order to progress a chargeback, or a claim under Section 75, customers are encouraged to contact their airline or travel provider as they may receive a refund or suitable alternative. If a refund or alternative isn’t offered, customers should contact us and we will be able to support with making a chargeback and/or a Section 75 claim.’
We received a similar response from Lloyds Bank, while other banks such as Virgin Money told us that they would look at claims on a case-by-case basis.
EasyJet, Ryanair and other airlines should refund you… eventually
However, most airlines, including easyJet and Ryanair, are not strictly refusing to pay refunds. When we contacted easyJet on behalf of one customer who had tried to make a credit card claim, Steven D’Hoe, the airline said that it would refund him.
However, airlines do seem to be making the process extremely hard. Passengers are reporting problems making claims and long waits on hold to talk to customer service.
Our advice is to persist with getting a refund from airline, but to wait until the pressure on customer services has died down. Airlines have told us that you have up to 12 months from the departure date to get your money back.
But some airlines, such as Air France-KLM, will not refund for at least a year
However, some airlines have said they are only issuing vouchers for future travel or the possibility of changing the flight when they cancel. Depending on the airline and where the flight is to or from, this could be could be in breach of EU261 legislation.
Air France-KLM says on its website that it’s not currently paying refunds. Steven D’Hoe also had a flight cancellation with Air France-KLM. He has made a Section 75 claim with Amex, but he hasn’t yet been told whether it will be successful.
We have asked Air France-KLM whether it will be refunding him and other passengers and it told us that it would not for at least a year but added:
‘Air France and KLM acknowledge that, under normal circumstances, passengers would receive a refund if a flight was cancelled. However, this situation is so exceptional – that Air France and KLM are being forced to depart from normal practice.’
It is offering passengers the opportunity to change flights free of charge, or apply for a voucher that will be valid for a year and can be used on Air France, KLM, Virgin Atlantic and Delta flights.
‘If, after 12 months, the voucher has still not been used, customers may then exchange it for a refund.’
Some passengers who paid via PayPal appear to have had more success in getting their money back.
On social media one Ryanair passenger posted that PayPal ruled in his favour and refunded his money after Ryanair failed to respond to the claim.
What should I do if I can’t get a refund from my airline?
In most cases, the airline should refund you. With call centres currently overwhelmed with calls, it may be worth waiting to make a claim.
If the airline absolutely won’t refund you and you paid by credit card, then there’s no reason not to make a claim on your credit card. While this is not the guaranteed way to get your money back that some sources claim, it won’t cost you anything and is worth a try. There is advice on how to go about it and an online form to use here.
If you are unhappy with your card provider’s response to a Section 75 claim then you can take it to the Financial Ombudsman.
If you paid by PayPal, you can try to dispute the payment, although it’s important to be aware that if the airline disagrees you have a right to a refund, it could later challenge you to pay it back.
If you don’t receive a reply to a request for a refund within eight weeks you can also escalate it to an adjudication scheme. EasyJet, Air France-KLM and numerous other airlines are members of AviationADR. British Airways are members of CEDR. Ryanair and Jet2 are not members of any scheme so you’d have to make your claim to the Civil Aviation Authority (CAA).
Travel insurance is another avenue worth trying. If you bought your insurance before the current crisis began and you’re covered for travel disruption, then you may be able to make a claim. Find out more about coronavirus and travel insurance.
- You can keep up to date on our latest coverage over on our coronavirus advice hub.