Why are pandemic refunds so slowly credited?

Do you feel that refunds are coming more slowly? You’re right — pandemic refunds are taking their time.

pandemic refundsI’ve heard slow refund excuses from “extraordinary” circumstances to “it’s complicated.” Companies are feeding consumers pandemic refunds explanations when they fail to meet their basic customer service obligations. Sometimes consumers need a dictionary to decipher the meaning behind the words and phrases in these excuses during the pandemic.

I almost did. After a recent story about the timing of refunds during the COVID-19 crisis, I got a call from someone who handles refunds at a large travel agency. She was unhappy with my advice of initiating a credit card dispute if the refund took longer than a month.

I reviewed all of our resolved Elliott-org cases from July to get a clearer picture of what companies were telling you. The results are fascinating — and a little disturbing. Seems companies are not only putting little or no effort into coming up with creative (or credible) reasons for failing to meet their obligations. Apparently, they think you’re going to buy their feeble excuses.

But I don’t think you are.

Why are refunds coming so slowly?

Companies love to blame their tardiness on technology. That’s the number one excuse I hear.

Travel companies always took their time with refunds. Here’s a 2010 case that took more than a year to get resolved. Here’s one that took two years.

But now they are dragging their feet on almost all refunds.

Here’s how one executive explained the situation to me. Travel companies, and particularly cruise lines, don’t have the technology to process refunds automatically. In normal times, they don’t consider that a problem, because they process relatively few refunds. (I do, because these manual refunds are still slow as molasses.)

But during a pandemic, where all cruises have been canceled, the system locks up. Refunds that would have taken weeks now take months. Some cruise lines like Oceania have even told customers to wait 99 days for their refunds.

Come on.

The pandemic refund system didn’t function well before COVID-19

pandemic refunds

Are we still in the 20th Century when it comes to refunds?

Apologists of the current system — the same folks telling you to wait patiently for your money — are defending technology that never worked. Think about this from a consumer’s perspective. It takes seconds for a credit card transaction to go through on your account and one or two days to post to your account. Why shouldn’t the money be returned as quickly?

Instead, we get excuses about “manually” processing refunds and old technology that wasn’t built for this kind of thing. And, frankly, it’s tiresome. We’ve heard the same excuses for years, and now they’re giving us the same recycled lines again: The system wasn’t built for fast refunds.

Well, why not?

The answer, of course, is that companies had no incentive to invest time or money into systems that processed faster automatic refunds. Instead, they spent their IT budget figuring out ways of extracting the money from your wallet faster.

Thanks for nothing.

“It’s not right to tell people to file a credit card dispute after a month,” the executive chided.

Perhaps. If you believe the current system is fair, that advice is unfair. But if you don’t — if you think the system was never fair — then one month is more than enough time.

It’s actually pretty generous.

Pandemic excuses that consumers are hearing right now

I decided to review our Elliott.org help cases to see what companies are telling their customers. I found the responses to be problematic. Most companies didn’t even bother to offer a reason for their service lapses. That’s new; usually, they try to offer an excuse.

8 Common travel scams and how to avoid them
Get cash airfare refunds instead of scrip — thank you DOT!

“Extraordinary” circumstances are getting the most blame

One large vacation rental company blamed “extraordinary” circumstances for simply pocketing a customer’s money. That’s absurd. If a burglar cites the extraordinary circumstances of not having enough money as the reason for breaking and entering, he’s still guilty of breaking the law. And even if we can blame COVID, aren’t we all living through the same nightmare?

Pandemic refunds are “complicated”

In another case, the same company claimed complexities hampered a speedy refund. That may well be true. But who sold a complicated product? That’s right, the company. In fact, by creating a more complicated product, companies can confuse their customers and profit from that confusion. So don’t you dare tell us that your customer service sucks because it’s “complicated.” It’s complicated because you made it complicated.

The case is already resolved. Look for it on next month’s credit card bill

That’s what one tour operator told us when we asked for help with a case. He said, with a straight face, that the case had already been resolved. It’s a classic “did-he-jump-or-was-he-pushed” situation. No one believes it. These kinds of pandemic refunds excuses are one of the most outrageous because they give consumers false hope and insults their intelligence. And no, the check is never in the mail. It goes in the mail the moment the customer contacts the attorney general, DOT, or your friendly consumer advocate.

“Sorry, the call volumes are more than we can handle”

A well-known financial site offered this pandemic excuse as the reason for failing to take care of a customer with an erroneous bill. I believe it. But I also believe there’s more to the story. Large companies can scale their call centers up and down, depending on demand. “High call volumes” probably means they are going to blame you and all your calls for their sluggish response time. In fact, they’re just slowing down refund payments as a business strategy during the pandemic. Pretty clever, huh?

“It’s not our fault” is an excuse that is used to pass the blame and buy time

This is an old favorite. It’s often used by online travel agencies to shift blame to an airline or hotel. And again, that may very well be true. But hang on! Isn’t that why you hire a travel agent — to help you navigate the complexities of the travel process? Also, imagine if the roles were reversed, and you told a company you can’t pay your bill because your dog chewed up your credit card or you lost your job. Would they care? They would not. Should you care when a company says it’s not their fault? You should not.

Stop the endless pandemic refunds excuses

Some of these excuses involve service lapses. But most of them are about money — specifically refunds. So here’s my best advice for dealing with pandemic excuses.

Listen politely to the words. Believe them if it makes you feel better.

Then look at the situation calmly:

  • If it’s been less than two weeks, give the company a chance.
    OK, it takes up to two days to post a purchase to your credit card account. I think two weeks is plenty of time for a refund. If the airline owes you a refund, the Transportation Department requires a refund within seven working days when you pay by credit card.
  • If it’s been more than a week, fire a warning shot. 
    By “warning shot” I mean send a brief, polite email to a customer service manager, asking for a refund. I list their names, numbers and email addresses on this site. Let them know, politely, that you will not wait forever.
  • If it’s been more than a month, file a dispute with your credit card.
    I know this is going to be upsetting to the companies reading this. But a month is more than enough time. The limits of a company’s refund systems are absolutely no concern of yours, just as your personal circumstances have no bearing on your obligation to pay your bill. If the company can’t get its act together, ask your bank to reverse the charges under the Fair Credit Billing Act.

I’m tired of the absurd pandemic excuses businesses are using on their customers. We deserve the truth, better customer service — and a fast refund.

Featured photo by Arlington Research on Unsplash
20th Century operator photo by Museums Victoria on Unsplash