Travel agents struggle with refunds as Go First extends cancellations

Go First on Tuesday filed for insolvency and cancelled flight bookings from May 3 to 5, prompting the aviation regulator to issue a show cause notice

A day after budget carrier Go First, which has filed for bankruptcy, extended flight cancellations by another three days to May 12, the Travel Agents Association of India on Saturday said that its members couldn’t refund passengers without the airline refunding them.

Budget carrier Go First, which has filed for bankruptcy, extended flight cancellations by another three days to May 12. (AFP)

This comes after Go First on Tuesday filed for insolvency and cancelled flight bookings from May 3 to 5, prompting the aviation regulator to issue a show cause notice. On Thursday, the airline declared that it would suspend the sale of tickets till May 15 and cancel flights till May 9. This was later extended to May 12.

“Hundreds of travel agents across the country have placed substantial deposits with your airline in a credit shell to be used for immediate and future bookings and which currently remain unutilized,” the agents’ association said in a letter to the carrier. “In addition, thousands of tickets need to be cancelled on account of the suspension of flights.”

A credit shell is a mechanism where the refund is not made in cash, but issued in a credit shell for the amount to be used in future bookings.

“Go First has been sending emails to the passengers who booked via travel agents to contact them for a refund,” a travel agent said, declining to be named. “Unless the airline gives actual credit, how is an agency expected to pay back the passengers? Is the agency expected to pay once to the airline (as credit) and again to the passenger?”

“Passengers whose flights have been cancelled have already begun calling their agents and clamouring for refunds,” the association said. “The agents have already paid you for such tickets, and they can’t refund the money until it is received from your airline.”