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Centrav Resources

New Airline Refund Rules: The Good, The Bad, and The Ugly

UPDATE: The Department of Transportation (DOT) issued an order to airlines to provide refunds to consumers for flights they have canceled. United Airlines, KLM, and Air France are some of the airlines that are now allowing refunds. A few weeks ago when we first published this article, airlines were in the process of getting government bailouts in order to shore up their finances and have cash flow. Some airlines have come through with tools to refund reservations and others we are still waiting for, but be patient! Also, be sure to note that the DOT states that it will refrain from pursuing action against a carrier that provided travel vouchers for future travel in lieu of refunds for canceled or significantly delayed flights. So credits may still be in your future at least for the next couple of months. 

E-credits. There has been a lot of talk and speculation about what the airlines are going to do during the COVID-19 crisis to stay in business, their current solution: e-credits. This solution will protect your commissions, save you a lot of time, and guarantee future travel to keep YOU in business. 

We at Centrav are your advocates to the airlines and want to help you navigate this new change as smoothly as possible. There are many great things that are coming from these changes, but there are also a few pitfalls too. We’ll walk you through what this means for you and your clients. 

DISCLAIMER: The below applies to some of the airlines, but not all. These new rules generally apply to travel dates before May 31, 2020. Please check with your airline specifically before rebooking. 

The Good

1. You can protect your commission

You may be worried that you are going to lose your commission because of all these refunds. We have good news for you…it is safe! Since the airlines are only offering e-credits, this protects your commission so your clients will have to exchange their travel dates instead of completely canceling. This ensures that your commission is retained. 

2. You save time

If you have purchased a domestic ticket with Centrav, you can use the self-service tools available only on the airline’s website.

If you want to cancel your ticket, you have the option to auto-cancel on Centrav.com. Learn how to request a change or cancel your ticketed booking

3. E-credits keep us all in business

Although you and/or your clients may be disappointed that the airlines are only offering e-credits… don’t be! By offering e-credits instead of refunds, it helps keep the airlines and YOU in business. Our industry depends on people traveling. During the COVID-19 scare, people have stopped traveling. But for travel agencies to thrive, we need them to eventually start again. With the airlines only offering e-credits, it will encourage your customers to rebook a travel package and resume traveling at a later date. 

4. Nonrefundable tickets converting to e-credits

You always take a gamble by buying a nonrefundable ticket, but this time the gamble was in your favor. Airlines don’t normally offer refunds on nonrefundable tickets, but this time–they do! You now get an e-credit with the airline to use at a later date. 

The Bad

1. Credits, not refunds

The unfortunate thing is that this is a credit, not a refund. So your customer will not have the option to cash out and do nothing. They must use the e-credit option toward a future trip or lose it. Although this seems like a bad thing, choose to see the good in this for your travel agency–this ensures that your customer will have to travel again in the future. Many airlines are now starting to comply with the DOT, but remember that offering credits is not something the DOT says they will pursue action against yet. 

2. Every airline is different. 

Not all airlines are created equally. In the same way that you would have to pay for a carry-on with one airline and not another, don’t assume that every airline is offering the same e-credit policies. Check with your airline on their website to find out their policy. 

The Ugly

Don’t do Chargebacks

If you or your client decides to do a chargeback, YOU lose out on your commission and it will create even more wasted time for you and your customer. Credit card companies are going to back the airline in this case. Save yourself and your client time by exchanging instead. 

How to Communicate with your Clients

We get it. Some of your customers have not been the easiest to work with during COVID-19. Some of them may not even like the new airline policies, we’re here to help you navigate those conversations. 

By the airlines offering e-credits and not full refunds, this encourages your customers to travel again in the near future. If the airlines were offering full refunds, there is a chance that the airline would go out of business and your client wouldn’t get their money back at all. 

Nonrefundable tickets–before purchasing a nonrefundable ticket on behalf of your client, you have communicated with your clients the caveats involved in buying a discounted ticket. If your client purchased a nonrefundable ticket, you can communicate with them that you have great news! Instead of a throw-away ticket they can now get an e-credit! 

Your clients still get to go on their trip, just at a later date. Currently, the prices are much cheaper than they were before when you originally booked their trip. By rebooking for a future date, there is a good chance they will get even more bang for their buck this time!

We are here to help navigate the ever-changing travel industry with you! We’re all in this together!

If your client is wondering why everything is taking so long, share this resource with them.

Macy Maxson

As Digital Marketing Strategist at Centrav, Macy loves all things marketing. Her passion is to help travel professionals run their business well and succeed! Her favorite destinations to travel to include the Caribbean and Europe.

30 comments

  • You said – e-credits give you 12 months to rebook your flights. 12 months from cancellation date or 12 months from original booking date. I saw yesterday an airline with 12 months from when it was originally booked. I had booked it in September so 12 months give them 6 months to book where as 12 months from today is 12 months. Can you be more explicit?

    • Hey Kathy,
      Check on your airline website! It really depends on who you booked with. You can check with the list of airlines we compiled here.

  • If a ticket was refundable less a penalty, does that mean the refundable amount still gets refunded and the penalty is a future credit?

  • So you can’t get a refund even on a “refundable” ticket? And what if the flight is officially cancelled by the airline?

    Assuming they do have to accept an E-Credit, if they have an international ticket, can they use the credit for a domestic ticket instead? Seem to remember that could be a problem when I asked Centrav earlier.

    Please advise.

  • I read from a colleague on a travel agent FaceBook site, that a customer chargeback will be addressed to the consolidator, who will send it back to the host company, who will charge it back to the travel agent. Can this be true that we could be personally liable for the entire ticketed amount sold and refunded to the client if they go this route?
    I already had a client tell me that when her flights were canceled for the first week in April that she expected a refund. I told her she would have to wait until 1 year later (1/17/2021) to get refunded since that was the policy about 10 days ago. Her reply was that she was not worried since she would just dispute it and get a refund from Amex for services not rendered. I never realized how this could effect me financially.

    • Hello Carol
      Yes – chargebacks ultimately rest with the Travel agent – and not the consolidator.
      I highly suggest to advise your client to NOT attempt a chargeback.
      Not all airlines are blocking refunds – only this list: https://www2.arccorp.com/refunds?utm_source=COVID19_Resources
      Plus – honestly – I’ve heard recently – the credit card companies Blocking chargebacks to the airlines…

      Tell you client to remain patient – the airlines will get the refunds processed – it is just going to take 1-2months. (not a year)
      -Erik

  • Hi Centrav,
    We have a lot of fares that we have booked with Centrav, that are for example Consolidator and Cruise Fares. Those type of fares, had a certain cancellation fee, for example $375 on a cruise fare. Every such fare that I booked, I used the Chat box to check what the cancellation fee was, and advised my client accordingly. Fares booked, need to stay under the cancellation fee advised at time of booking. Our clients will expect to be able to cancel them for the cancellation fee advised. We also have fares that have cancelled flights, where clients can cancel due to schedule changes – those tickets should also be refundable.
    It is not acceptable that all fares should suddenly be E-credits only. That might be the case with most published fares, unless there is a cancelled flight or schedule change that now allows cancel and refund.

    • The airlines that inhibiting refunds are only doing this temporarily. We will be able to process refunds w/ a fee in a few months.
      Should your clients want a refund less the standard fee – I suggest waiting – and not converting to E-credit.
      It is my understanding we will be able to do this starting in June. (subject to Covid changing it all…)

      -Erik

    • Hello Evi,
      Any ticket that Centrav paid a commission to your agency – we would need to recall the commission to process the refund.

      -Erik

  • Will we be getting emails regarding our e-credit? My clients flight are canceled but that is the last I have heard. Have seen no update when I pull up my clients canceled flight from My Bookings. They were not scheduled to fly until 4/11

    • Hello Kathy –
      We are sorry for the delay – in most cases the E-credit is the Ticket Number of their previous flight.
      Without the airline you are referring to I would be unable to advise specifically.

      -Erik

  • Macy,
    My clients were traveling with others that booked direct with AA and they are receiving refunds. I submitted the request to Centrav on Saturday…are they grandfathered in to get the refund instead of E credit? That is the preference even given this otherwise good news. Thanks Jan

  • I have a Business class ticket on Turkish Airways ticketed on January 17, 2020 for travel April 25,2020. When booking the agent advised of a $475.00 cancel fee per ticket. Does that still apply?

    If the client chooses the Zero Change Fee option that was offered today how do we process that thru the website? Do we cancel as instructed and make a comment in the comment field that they choose the Zero Change Fee?

  • The rules on AA say if you book a published flight before March 31st you can make changes for free. So, does this not apply to cruise rates and consolidator tickets purchased on Centrav?

    • Some airlines have it “rebook” by the end of 2020, some airlines are saying “travel” – Emirates is saying 760 days…

      -Erik

  • I have people booked on Aer Lingus for travel in June 2020 to take a tour which has been cancelled by the tour operator. The air was done thru Centrav. Currently Aer Lingus is not offering any waivers out that far. Aer Lingus also will not allow me to modify any bookings done thru a third party such as Centrav, stating they can only be changed / cancelled, etc by Centrav. Since this ticket is now unusable by the client as it is for a cancelled tour, and since Aer Lingus will not allow me to manage the booking, what are my options?

    • Hello Russell –
      You are correct – June is not the scope of Aer Lingus right now.
      The best is to wait – the COVID-19 issues are not over – give it time – I think the waivers will be extended in about 2 weeks.
      (no guarantee – but its looking this way)

      -Erik

  • Hey All, thanks for the great info. Hopefully, someone can assist me .. This was my very 1st Centrav Booking which I totally messed up to begin with. My Clients are Million Mile Flyers with United & we booked Business Class which they fly a the time. This has multiple segments beginning in Denver to Barcelona, then from Seville to New York back to Colorado. About $10k for 2 people traveling mid June till late June. Here’s the deal…. Here’s telling me that Business Class gets a full refund no matter what but I just read all these E-Doc refund disclaimers from all the different airlines and I can’t seem to find anything about Business or First Class International fares being refunded in cash or anything for that matter. Would this type of info be here somewhere and where might I go for this specific info either with the Airline or here with Centrav or do I just need to contact the Airline first .. thanks for listening and for your help!

    • Hello Laura,
      Regardless of cabin purchased – non-refundable fares still remain non-refundable with United Airlines.
      In your case – United has not yet cancelled flights this late into May. So the current answer is to wait.
      Or – should the passenger want – we can apply 100% of the fare total to a new flight – this free change is for flights up to Dec 31, 2020 (fare difference may apply)

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