In these unprecedented times of Covid-19, which has seen the cruise industry come to a standstill, consumers have encountered many hurdles to get a refund from cruise lines or their travel agent.
While millions of people have taken vouchers from the cruise lines, at an incentivised rate of 125%, travellers should note that these would be likely be worthless if the operator went out of business. Unfortunately, there is no real certainty on this and it’s now become even more concerning with Norwegian Cruise Holdings, the parent company of Norwegian Cruise Line, Regent Seven Seas Cruises and Oceania Cruises, saying yesterday that there is “substantial doubt” about its ability to continue as a “going concern”.
While we all want to see a buoyant cruise industry, the operators have struggled to process refunds – e.g Royal Caribbean initially saying 30 days to process, then 45 days, and now unable to say how long it is going to take. (We’ve asked them to clarify).
None of us want to see cruise lines go out of business, and everyone understands that organisations are working remotely, or social distancing. But there are people needing to gain the funds more quickly, due to their own personal circumstances.
For people in this category, there is an option called ‘chargeback’ which is a mechanism for consumers to reclaim money from the retailer’s bank. Chargeback is not enshrined in law but is part of scheme rules, which participating banks subscribe to.
Debit cards: It applies to all debit cards goods, although exact rules may vary between the Visa, Maestro and American Express – so check with your card provider.
Credit cards Chargeback is particularly useful where the cost of the goods or services was under £100 and Section 75 doesn’t apply. For all credit card transactions over £100 you also have rights under Section 75 – so check with your card provider.
It’s worth noting most bank staff don’t really know about this procedure, so you may need to explain it to them. You should also be aware that the operator may challenge the chargeback.
The guidance above applies to UK residents, and may vary in different countries.