Nine months to wait for a refund? You’ve gotta be kidding

sasIt takes only a few seconds for an airline to take the money from your credit card. Why does it take forever and a day to get a refund?

The answer in a moment. But first, let me introduce you to Antti Seppala, the latest victim of an industry that has failed to put its customers first. He and his wife bought a package trip to Helsinki through Expedia in March, but had to cancel the trip.

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He explains:

After the trip was paid, we received message from my wife’s relatives that her sister has suddenly passed away. The planned funeral date would have required an extension to this already-paid trip.

After complicated negotiations with Expedia, they agreed to cancel the trip with the exception of the airline penalty, $300. And we were told that this penalty fee can be requested back from the airline because of the circumstances for which we needed to cancel the trip.

Expedia agreed to these arrangements because we needed to at that point to purchase a new trip which would include the dates for the funeral. This new trip was considerably more expensive than the first canceled one but at that point we did not have much choices.

Seppala was led to believe he’d get a prompt refund of $300 from Scandinavian Airlines. But then Expedia sent him emails requesting extensive documentation about the family emergency that led to the cancellation, and it became clear to him that the refund wasn’t going to be immediate.

Now, at this point I have to say that I’m with Expedia and Scandinavian. You want to make sure all of your “I’s are dotted and “T”s are crossed, and that Seppala is truly entitled to the $300 refund. But a few weeks later, he reported back:

Expedia have either claimed that the documentation is insufficient or that they have not received it at all.

I have sent the documentation by fax and/or by US mail (to their Tacoma office) at least six times during the last three months and as you can see in their latest Email they now claim that they still need those same documents which they already have received long time ago.

Sure enough, he enclosed an email in with Expedia asked for more documents. Was it stonewalling?

I decided to contact Expedia on Seppala’s behalf. A representative promised to look into the matter right away.

On Aug. 10, he received the following email from his online travel agency:

Dear Antti Seppala,

Thank you for contacting us about a ticket refund.

We are writing to let you know that your request for a refund was approved by the airline.

The refund was processed to the original form of payment. Please allow 1 to 2 billing cycles for the credit to appear on the credit card statement.

If you have further questions, please contact Expedia customer services at 1-800-397-3342.

Please do not respond to this email address as it is not monitored.

Case closed? Hardly. Two billing cycles later, Expedia still hadn’t sent the money to Seppala. He was starting to get impatient. So was I.

But what can you do? We had no choice but to wait. Yesterday, I finally heard from him.

I received a message from my bank that the reimbursement of the $300 penalty will be posted to my account on Jan 4, 2010. So, I still have not received the money but now I feel certain that I will get it.

It took about 9 months to do this. Unbelievable.

Hey Expedia, there’s no excuse for this. You take our money in a split-second. You take nine months to return it. What do you think we are, a bank?

To be completely fair, this isn’t just Expedia’s fault (some of the credit goes to Scandinavian, too) and it isn’t the only travel company that does this. In fact, they all to it. This is just an extreme example.

So you wonder: why?

Over the years, I’ve heard a lot of explanations from the travel company’s side. It’s our technology. We don’t have enough staff. It’s the airline’s fault. But the excuse that rings truest is this one: We don’t care.

A travel company has no incentive to return the money quickly, particularly when you’re dealing with a discounted travel package from a consumer who is shopping for a product based on price alone. Put differently, Seppala probably wasn’t booking through Expedia out of any loyalty to the company, but because it was a good deal. If he finds a better deal through Orbitz or Travelocity the next time, he’ll buy there.

Why should Expedia care how fast Seppala gets his money back? It’s not as if he’s a high-value customer.

I think travel companies must be made to care. What if there were a law that said travel companies had to pay interest on customers’ money they held for more than 30 days? Do you think the refunds would happen quicker?

Bet on it.

(Photo: wicho/Flickr Creative Commons)