£7billion in holiday refunds owed to Brits by airlines

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Holidaymakers could be owed £7billion in refunds for cancelled trips amid the global coronavirus pandemic.

In an investigation by Which?, it has been revealed some companies are refusing to provide refunds, while others are pushing customers to take vouchers or credit notes "which may prove to be worthless" if holiday firms collapse.

Which? said none of the country's 10 biggest holiday companies have been offering full refunds within the legal time frame.

And some are refusing to pay refunds altogether.

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The government has come under fire for not stepping in when lenders and travel companies have illegally withheld cash refunds for customers – which should have been paid out within a week for flights and 14 days for package deals.

The Competition and Markets Authority revealed it is getting complaints every day and said four out of five complaints are from British customers who have been denied travel refunds.

The UK watchdog is expected to announce a new crackdown soon.

Industry estimates suggest companies could be sitting on around £7 billion in unpaid refunds.

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Airlines including easyJet, Jet2, Virgin Atlantic, British Airways, Ryanair and TUI have all been accused of flouting the law and pushing customers to accept credit-note vouchers, instead of offering them a cash refund which they're legally entitled to.

Vouchers offer customers little protection and could prove worthless if the firm were to go bust.

Tui planes after Prime Minister Boris Johnson put the UK in lockdown to help curb the spread of the coronavirus.

Customers are allowed to reject a voucher in favour of a refund, though obtaining a cash pay out could be time consuming and difficult.

Airlines are not immune to the negative effects of the global virus.

British Airways revealed it is making up to 12,000 workers redundant and last week billionaire businessman Richard Branson asked the government to financially support his struggling Virgin Atlantic company, at a cost of around £500million.

Booking a trip on a credit card usually guarantees some protection, but those holidaymakers who booked a getaway using a credit card have also struggled to get cash back from banks.

Section 75 of the Consumer Credit Act firmly putting refunds in law.

Some lenders have been telling customers they are not eligible for cash refunds, or demanding they pursue a payout from the travel firm first, which is not a legal requirement.

The Association of British Travel Agents (ABTA) has been lobbying ministers to relax rules requiring airlines to issue refunds within a set timeframe, despite airlines continuing to push customers towards vouchers instead of refunds.

Under EU law, which MoneySavingExpert founder Martin Lewis repeatedly says still stands for Brits, passengers are entitled to a full refund on the cost of a cancelled flight within seven days, or 14 days if they have booked it as part of a package.

The government is being pushed to act on the issue which has left many families out of pocket during these unprecedented times.

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