Agents are bearing the brunt of disgruntled passengers who say their money is being unlawfully withheld as an more airlines delay refunds on bookings affected by the COVID-19 pandemic.
Iata has recommended that airlines issue vouchers rather than cash refunds with the association estimating airlines are facing an estimated US$35bn (R623,80bn) ticket refund bill. See more here.
Asata says refusing to give clients the option of making use of a voucher system or a cash refund is unlawful. “Airlines have been switching off refund applications via the GDS and we are receiving reports of airlines advising agents that refunds through BSP link could take up to six months to process,” said Asata in a statement this week.
The association says it has been in discussions with Iata about these policies and has appealed to the association and its airline members to consider implementing alternative options.
In a letter Asata addressed to Iata, the agent association tackles SAA’s refund policy. The national carrier deactivated its GDS and BSPLink refunds application system. “This action is in direct contravention of the South African consumer protection laws, which provides consumers with the right to a cash refund in the event that a service can no longer be rendered due to circumstances beyond the control of the service provider. Our Consumer Goods and Service Ombud has stated emphatically that blanket no-refund policies are illegal in terms of the law,” ceo of Asata, Otto de Vries, says.
In a separate letter, Asata accused airlines of failing to protect the integrity of the BSP by not applying the processes set out for refunds within the system and by flouting consumer laws to avoid refunding agents and their customers. The association has requested that Iata give agents the option to set off their debts against receivable as part of their next remittance. Alternatively, it suggests Iata keep money in a trust account to secure BSP obligations due to the agent.
Asata has also put forward a request to Iata and airlines to retain monthly BSP remittance in SA. However, as many agents are currently shifting from a payable to a receivable position (refunds due exceed remittance due) this could mean that many agents would benefit quicker from a more frequent remittance period. This solution is subject to airlines refunding agents and, as such, may be purely academic, Asata says.
The association advises agents to apply to Iata to review their financial security through the Iata portal and ask for a reduction of their Remittance Holding Capacity. This could free up some cash for agents during this time.
TNW approached Iata for comment but had not yet heard back from the association at time of publishing.
