After the mass cancellation of flights and other travel bookings that followed the onset of the COVID-19 pandemic in early 2020, few customers got full refunds. 

Instead of getting their money back, many got a travel credit or voucher, or a partial refund plus a voucher, while others got nothing at all. 

And many jilted customers rightly wondered – how can these businesses get away with holding on to my money? 

Refunds refused

We heard from one Virgin Australia customer who has $5000 in travel credits, but really just wants their money back. Another has $16,000 in credits and has been refused a refund.

"I would prefer a refund after two years [of not being able to travel], but Jetstar refuses," another credit holder told us.

Travellers whose credits are still valid are trying to figure out how to use them

Some credits or vouchers had tight expiry dates – optimistically set a year away, for instance, when it seemed possible that the pandemic might just magically disappear. 

That didn't come to pass, of course, and now travellers whose credits are still valid are trying to figure out how to use them. We've heard from hundreds of customers who say this hasn't been easy. 

National flight credits survey 

In a recent nationally representative survey of flight credit holders, we found that almost three-quarters (72%) of Australians who've had a flight cancelled due to COVID-19 have received a flight voucher. Less than a third (31%) got a refund. 

More than a fifth (21%) of Australians who've tried to use their flight voucher have been unable to do so.

In terms of flights alone, the travel credit issue has affected a lot of people. Our national survey revealed that almost three-quarters (73%) of Australians who booked flights in the past two years have had a flight cancelled, and 52% of people who booked flights received a flight voucher due to a COVID-19-related cancellation. 

Of those who were able to use their flight vouchers, 44% had to pay more than the original cost of the flight. For those who weren't able to use their vouchers, the main reasons were that there weren't any flights available for the same price, or that the voucher had expired before they could use it.

It's very concerning that so many Australians have been unable to use the flight vouchers given to them due to COVID-19-related cancellations that were completely out of their hands

CHOICE campaigner Dean Price

"If I could avoid it, I would try not to ever have a flight credit again," one voucher holder told us. "It was difficult to claim back, and the flights cost more to use with the voucher and all the fees."

Credit-holders' experiences are 'concerning'

"It's very concerning that so many Australians have been unable to use the flight vouchers given to them due to COVID-19 related cancellations that were completely out of their hands," says CHOICE campaigner, Dean Price. "This kind of experience has unfortunately become all too common, and needs to be stopped.

"When it came to the people who actually were able to use their flight vouchers, almost a third had to pay more than the original cost of the flight. Australians have also told CHOICE that it was incredibly difficult to claim the value of the voucher back, and said they would try to avoid receiving a flight credit over a refund in the future."

Travel credit holders say it's difficult at best to redeem the credits they've been given in lieu of refunds.

Credits up in smoke 

And it's not just flights – the travel credit issue runs across the travel sector. 

"I haven't been able to use the travel credit due to ongoing COVID restrictions or safety issues and now the credit has been removed," one credit holder recently told us, summing up the frustrations of many. 

"I have a travel credit but I am feeling pressured to use it on a tour I don't really want before it expires," said another. 

I have tried to use one voucher, but the airline simply made it too difficult

CHOICE travel survey respondent

Another told us, "I have tried to use one voucher but the airline simply made it too difficult, and another credit has just disappeared. Both were for flights cancelled in 2020 by the airlines, not me."

Considering that almost half (47%) of Australians have had to cancel travel plans due to COVID-19 since March 2020, the frustrations we've heard probably point to a systemic issue.

Redemption options unclear 

Credit holders in general reported difficulty working out how to use them, an obstacle made worse by the near impossibility of contacting customer support for guidance. 

Some lost track of which credits they were owed and gave up on the idea of ever reclaiming what they'd paid for. 

"It's not clear what travel credits you have and when they expire so I really have no idea what I've got and what I have lost," one bewildered customer told us.

"The credits keep getting changed to another, more complicated system," said another. 

It's not clear what travel credits you have and when they expire so I really have no idea what I've got and what I have lost

CHOICE travel survey respondent

Others said they were asked to pay more than the value of the credit to book a reservation, or that the travel service they wanted couldn't be booked with a credit. 

Many were simply left in the dark. 

"I had requested a voucher, which I have been unable to use," one respondent said. "I requested a refund, which I've been promised, yet I am still without either a voucher now or a refund." 

Paying more than the credit's worth

Many consumers we've heard from who used a flight or other credit to rebook the same service say they had to pay more than the credit's value. 

In some cases, the value of the credit was more than the cost of the booking, but travellers were made to use the full credit anyway. 

"I have rebooked flights with Flight Centre, but as the new flights were cheaper I was not allowed to take them," one respondent said. "I had to book dearer flights and pay the extra money." 

I managed to get the travel credits refunded to my credit card... It took me at least six months of constant email and phone calls

CHOICE travel survey respondent

One lucky customer pulled off the rare feat of cashing in their credit, but said it wasn't easy. 

"After a great deal of difficulty, I managed to get the travel credits refunded to my credit card," they told us. "It took me at least six months of constant email and phone calls." 

For many others, ongoing efforts to have their money refunded have come to naught.

Travel credit holders have reported ongoing difficulties in trying to reach customer services to sort out credit redemption issues.

Is it legal for airlines or third parties to keep your money? 

With Australians hit by hundreds of thousands of travel cancellations over the past two years, the ACCC has gone on record to clarify that your right to a refund depends on the terms and conditions (T&Cs) of your travel agreement. 

As we explained in mid-2021, however, you're also entitled to your money back if you were led to believe the booking was refundable, regardless of what the T&Cs say. 

Many people who've had to cancel their plans have found the terms of their travel deals more or less incomprehensible

But as our recent survey shows, many people who've had to cancel their plans have found the terms of their travel deals more or less incomprehensible, which is why CHOICE has called for a mandatory information standard for all travel services providers. 

The proposed standard would include clear disclosure of how much money would be returned to customers in the event of a cancellation, and how customers could seek remedies from third-party booking sites and other intermediaries. The NSW government is currently considering such a standard. 

Stock images: Getty, unless otherwise stated.

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