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Airlines unlikely to refund Rs 3,000 crore owed to passengers: Report

Airline executives have said that issuing refunds to passengers would not be possible for many.

August 03, 2020 / 09:42 AM IST

Airlines, among worst-hit due to the COVID-19 crisis, are unlikely to refund about Rs 3,000 crore owed to passengers in lieu of tickets cancelled during and after the coronavirus lockdown.

Airlines have issued Rs 3,000 crore worth of travel credit, which can be used to travel at a future date. About Rs 1,500 crore has been refunded to passengers, reported The Economic Times. These estimates were a part of the discussion between airlines and the government.

The Supreme Court asked the Centre to look into the issue of refunds.

Airline executives, meanwhile, said that the industry was struggling financially and issuing refunds to passengers would not be possible for many.

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"It is not that the airlines have not returned the money," said an airline executive, requesting anonymity. "The money has been put in a shell," the executive added.

As per the government, the airlines cannot be forced to issue refunds because they do not have funds.

"Airlines are going through their worst phase and forcing them to refund this amount would not be possible," a government official told ET on a condition of anonymity.

"There is a need to devise a solution that takes care of both airlines and passengers," the official added.

Moneycontrol could not independently verify the report.

While SpiceJet said it had complied with all refund rules announced by the aviation regulator, an IndiGo spokesperson said the airline would comply with any decision taken for the industry.

Airlines have been batting against a full refund after customers have sought a refund for the tickets instead of adding the refund amount to a credit shell that can be used to book tickets later within a specified period.

SpiceJet earlier told SC that no airline across the world was issuing full refunds. They requested to be allowed to work with the aviation regulator DGCA and the government to find a solution.

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Moneycontrol News
first published: Aug 3, 2020 09:19 am

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