By Ranjit Singh
THE Federation of Asean Travel Associations (FATA) has raised concerns that many airline passengers were not getting refunds for flights which were cancelled due to the Covid-19 outbreak. It is a common practice for airlines to provide vouchers for passengers as opposed to outright refunds for their cancelled flights during the pandemic.
“Airlines must prioritise in providing refunds instead of issuing vouchers which may have little or no value should they be liquidated,” said FATA president Datuk Tan Kok Liang in a statement today.
He said it was a matter of principle that airlines returned payments that have been collected from customers.
“As depicted in the United States, the Department of Transport (DOT) has alerted all airlines (US and foreign) that passengers should be refunded promptly; for flights to, within or from the United States when their scheduled flights are cancelled or significantly delayed and the passenger chooses not to accept the alternatives,” said Tan.
“And Section 12, First Schedule, Item 5 of the Malaysian Aviation Consumer Protection Code (MACPC) 2016, which is to protect consumer interest in air travel, requires airlines to resolve complaints and remit refunds to consumers within 30 days of receipt of the complaints.
“IATA (International Air Travel Agency) itself provides that under Resolution 824r, refunds shall be made not later than the following remittance schedule after the refund application is received from the agent by the airlines,” added Tan.
A Malaysia Airlines (MAS) spokesperson told FocusM that the airline does not provide refunds for flights cancelled either by the airline itself or by passengers. It provides vouchers instead for an alternative flight.
“We provide travel vouchers for cancelled flights and the booking must be done before Dec 31, 2020 and the passenger must fly before June 30, 2021. Failure to fly within the stipulated time would mean that the ticket is ‘burnt’,” said the spokesperson.
Tan Sri Tony Fernandes, group CEO of low-cost carrier AirAsia Bhd, said in a statement yesterday that the airline was encouraging customers to accept “credits” for cancelled flights and that 80% of its customers had opted for the “credits”. The “credits” have a 365-day validity period.
Fernandes said the airline would pay out refunds on a case-by-case basis but the waiting period for such refunds would be between 12 and 16 weeks due to the heavy volume.
Meanwhile, hybrid airline Malindo Air said on its website it only provides vouchers in lieu of cancelled flights.
Given that airlines are in a precarious position due to subdued air travel during the Covid-19 outbreak, it should be more accommodative to its passengers’ requests for refunds. After all, these monies have been paid upfront by the passengers and the airlines should hold these amounts in trust accounts.
However, the current practice is that airlines accrue the amounts as revenue and utilise the funds for other operational expenses. This seems to be grossly unfair and the authorities should step in and rectify the situation. — April 13, 2020
