Thursday, April 30, 2020

Double whammy for India’s travel aggregators – bookings have stopped but refunds come out of their own pockets

The Ministry of Civil Aviation in India announced on April 16 that airlines will have to give a full refund for cancelled tickets, due to the coronavirus lockdown.
While passengers across the country heaved a sigh of relief, travel aggregators knew this was a double whammy for them. Why? Online travel aggregators in India work in a system where they have a virtual wallet with airlines where they have preloaded money for bookings.
 So when airlines refund the tickets it comes into this wallet, which can’t be used for refunds or transfer of money into accounts. But for travel aggregators to issue refunds it will have to come out of their pockets, and its airline credit is not transferred.
 “So our wallet balance with airlines will be blocked till the time we start getting fresh bookings and we have to use our cash flow to refund to customers, whenever fresh bookings will start we would be able to utilize that agency wallet to book tickets for our customers,” Nishant Pitti, Cofounder and CEO, EaseMyTrip told Business Insider.
30/04/20 Sanchita Dash/Business Insider
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