Following vacation cancellations, some people were offered vouchers instead of cash refunds, but they caused anger and confusion among travelers.
Some companies have claimed that the credit ratings are protected by ATOL and that if the company goes bankrupt, they can still get their money back, reports The Mirror.
Now Martin has given an update on this in his Money Saving Expert bulletin and has advised that those affected by canceled flights accepting a voucher rather than cash would make it “unlikely that you would be able to claim on a card debit / credit if the business goes bankrupt. “
He said, “I’ve been looking for confirmation on this for a while, and now I have an answer, but it’s not great.
“If you’ve had a canceled flight, the law gives you the right to a refund within a week, and the Competition and Markets Authority says other sectors should generally give cancellation refunds as well.
“Yet many people accept the vouchers – rightly because they want to help the business, or wrongly because the companies flout the rules, refused refunds, or made them difficult to obtain.
“In the travel industry, some companies issue” repayable credit notes “which they say are protected by ATOL – although this has not been tested. and are unlikely to get money back. ”
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When this happens, in any other circumstance, Martin advises using chargeback or section 75 to try to get a refund from your debit or credit card provider and asked the financial ombudsman if this could operate here.
They replied, “If a voucher is offered in the full and final settlement of a claim, it could mean that you will no longer be able to make a section 75 claim or charge back. “
Martin therefore advises you to check the terms and conditions of your voucher or credit note to see if you can request a cash refund at a later date.