Credit notes to customers who have to cancel their holidays will be Government backed
Customers will receive credit note to the value of their holiday if refund is not possible
Minister for Transport Shane Ross said many travel agents and tour operators are having severe cash flow problems. Photograph: Colin Keegan, Collins Dublin
Holidaymakers who have had to cancel their holidays because of Covid-19 will receive a Government-backed credit note for the value of their holiday.
The credit note will be available in the event that a tour operator does not have the cash to offer a full refund to customers.
The offer has been made because of fears that many tour operators will not be able to refund customers in full for holidays booked in March, April or May.
The vouchers will be State-guaranteed in the event that the travel agent or tour operator becomes insolvent and cannot pay back their customers.
The refund credit note will be to the value of all of the refund due or part of the refund alongside part cash.
It will be issued with a future redeemable date, and on that date it can be exchanged for its cash value, or can be used to book a replacement holiday.
Minister for Transport Shane Ross said people who have had to cancel bookings because of Covid-19 travel are entitled to a full refund, but many travel agents and tour operators are having severe cash flow problems.
“It is not clear that all of them will be able to meet all of their current cash refund obligations and at the same time be able to stay in business,” he explained.
“The Government has therefore agreed to back a new refund credit note that travel agents and tour operators can offer their customers.
“These are very difficult days for our tourism industry and for the many travel agencies and tour operators who have seen their businesses face near collapse in recent months. However, it is also financially challenging for people who booked holidays and are entitled to a refund of their investment.
“The refund credit note aims to strike a balance between preventing sector-wide bankruptcy (with associated immediate job losses) and consumer rights.”
Irish Travel Agents Association chief executive Pat Dawson welcomed the Government move. He said travel agents are the worst affected of all businesses because of Covid-19. Many have had no bookings since February 28th and are unlikely to get any more bookings this year.
Many are waiting themselves to get money back from airlines, hotels and travel operators, he added.
“It gives the travel agent some breathing space to get back in business, but that’s going to take longer than any other business in the country,” he said.
Mr Dawson stressed that the move will give reassurance to customers as the credit note is Government-backed.
“We are satisfied that the customer is protected.”