Monday 10/25/21

Consumer authority recommends against accepting Norwegian cash points

The Consumer Ombudsman reminds that, by law, consumers have the right to receive a cash refund whenever an airline cancels a flight.
A Norwegian plane landing. Photo: Jørgen Syversen.
A Norwegian plane landing on the snow. Photo: Jørgen Syversen.

The Consumer Ombudsman is "concerned" about the so-called 'cash points' which the airline Norwegian is offering to consumers as an alternative to cash refunds when the company cancels flights.

The Finnish competition and consumer authority emphasizes that, according to current information, the company is cancelling almost all of its flights for at least one year, even if the company continues to operate.

Suffering from financial difficulties, Norwegian is holding its annual general meeting on Monday 4 May 2020. This meeting will decide whether the airline will be approved for debt adjustment in order to avoid bankruptcy.

–"Now is not the time to accept the cash points offered by Norwegian, as it is uncertain whether the airline will be providing any flights. According to Norwegian's current terms and conditions, the points will also be valid for one year only. Therefore, refunds should be requested in cash. Consumers should not make any new bookings or transfer flights right now, either. Instead of cancelling a flight yourself, you should wait for the airline to cancel it," emphasises Consumer Ombudsman Katri Väänänen.

Right to receive cash refund

The Consumer Ombudsman reminds that, by law, consumers have the right to receive a cash refund whenever an airline cancels a flight. If the journey has been paid by credit card or with credit offered for the purpose of paying the flight, a refund for the payment can be applied from the creditor in accordance with the Consumer Protection Act. "The credit company has joint responsibility for the refund and cannot require that the consumer contacts the airline first," the authority says.

–"If an airline goes bankrupt, consumers who have accepted a gift card may lose their right to claim the money back from their credit card company."

The Consumer Ombudsman is monitoring Norwegian's situation closely.

Consumers not sufficiently informed

The authority says it is also concerned about Norwegian’s customer communications related to their cancellation practices.

According to the observations made by the Consumer Ombudsman, Norwegian has not always informed its customers sufficiently clearly what choices customers have when the airline cancels a flight.

-"Norwegian’s communications have emphasised the company's own cash points system, and the refund option has not always been communicated sufficiently early and in a clear way," the Ombudsman says in a press release.