Why did my ticket refund take forever and a day?

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By Christopher Elliott

Gripes about lengthy refunds are not unique to the travel industry, or even to airlines. But if you want your money back for a ticket, you should probably be prepared for a long wait.

Cecil Lau wishes he had known when he asked American Airlines for a refund on a ticket from Toronto to Hong Kong. As a refresher, most discounted airline tickets are nonrefundable, but some are. Lau was lucky enough to have one. So when he asked for his money back, American agreed to credit his card $1,300.

Only, it didn’t say when it would get around to it.

“Now, almost two months later, I still see no credit back to my card,” he says. “I called American again and they said the refund had already been processed and credited to my card.”

U.S. regulations are clear about the timing of refunds. When a refund is due, the airline must forward a credit to your card company within seven business days after receiving a complete refund application, according to the Transportation Department. However, the credit may take a month or two to appear on your statement.

The gray area of refunds

I’m unable to find a similar requirement under Canadian regulations, at least as it applies to airlines, but it stands to reason that an airline can’t keep your money indefinitely — although, if anyone needs the money right now, it’s probably American.

But Lau’s problem is hardly unique, and it’s not limited to airlines. Travel agencies — and especially online travel agencies — keep your money for a while. When I’ve investigated this refund latency, experts tell me the following: First, there are no real requirements for a prompt refund. It’s just a gray area some companies exploit.

Second, while technology exists to take money out of your credit card account in a few seconds, there’s no incentive to return it as fast. So companies don’t invest in the technology and human resources necessary to process a fast refund.

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And third — and this is perhaps the most upsetting of all — companies can benefit from holding on to your hard-earned money. Having that money in their coffers, even for a few extra months, can have certain financial benefits. (Think of it as a microloan, with you as the unwilling lender.)

The mystery behind delayed reimbursements

It’s unclear what caused Lau’s delay.

“I called the credit card company and they said they don’t see the reverse-transaction anywhere,” he says. “I got passed onto the dispute department and they requested some form of confirmation that American did indeed refund my ticket.”

The mystery deepened when he checked the AA.com website, which showed he hadn’t requested a ticket refund.

“Yet the system also shows that the ticket has been refunded,” he added. “I requested American to send me a refund email confirmation, and they said ‘We don’t do that.'”

Efforts to call American were unsuccessful. (“No one ever picks up the phone,” he says.)

This isn’t an easy case. A credit card dispute is unlikely to work, because the window is long past, and besides, the airline insists it’s sent the money. But without a written verification, which would serve as a debit memo, the credit card company is powerless to help.

A reminder to hold companies accountable

The only option Lau had was to wait — or to contact me. He chose the latter.

I contacted American and it processed the $1,300 refund, minus an explanation. If I had to make an educated guess, I’d say this was just a system problem exacerbated by the company’s bankruptcy. (Here’s how to get a refund on a non-refundable airline ticket.)

Not that it’s an excuse. (Related: Where’s my airline ticket refund from GotoGate to Srilankan?)

If you ever find a company dragging its feet on a refund — whether it’s an airline or any other company — don’t let it get away with it. Contact your credit card company right away, appeal your case to someone higher up at the company, and if that doesn’t work, please let me know.

Corporations, contrary to what some politicians might say, are not people. They don’t feel the same pain you or I do when that refund you were expecting doesn’t arrive in your account.

Sometimes, you have to remind them of that fact.

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Christopher Elliott

Christopher Elliott is the founder of Elliott Advocacy, a 501(c)(3) nonprofit organization that empowers consumers to solve their problems and helps those who can't. He's the author of numerous books on consumer advocacy and writes three nationally syndicated columns. He also publishes the Elliott Report, a news site for consumers, and Elliott Confidential, a critically acclaimed newsletter about customer service. If you have a consumer problem you can't solve, contact him directly through his advocacy website. You can also follow him on X, Facebook, and LinkedIn, or sign up for his daily newsletter.

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