Tag Archives: credit shells

Indian LCC IndiGo claims that the airline has already processed close to Rs1030 crore of refunds, which amounts to about 99.95% of the total amount owed to its customers. The pending credit shells are mostly cash transactions wherein IndiGo is awaiting bank transfer details from the customers.

IndiGo has said that they will make complete payment against all pending credit shells latest by 31st January, 2021. The airline has been refunding amounts owed to customers whose flights had been cancelled during the lockdown and has processed close to INR 1000cr of refunds already, which is approximately 90% of the total amount owed to the customers. Ronojoy Dutta, Chief Executive Officer, IndiGo said, “The sudden onset of Covid19 and the resulting lockdown, brought our operations to a complete halt by the end of March of this year. As our incoming cash flow dried up, we were unable to immediately process refunds for cancelled flights and had to create credit shells for the refunds that were due to our customers. However, with the resumption of operations and a steady increase in demand for air travel, our priority has been to refund the credit shell amounts in an expedited manner. We are pleased to commit that we will disburse the full 100% credit shell payments latest by January 31, 2021. We would like to thank all our customers who stood by us for their patience and understanding during this unprecedented crisis.”

Travel agents need to put forth their case before the Supreme Court to make the Bench conscious of the plight of travel agents while finally deciding the matter on issue of credit shells given by airlines instead of cash refunds, says Dheeraj Nair, Partner and Vishrutyi Sahni, Associate at J. Sagar Associates. “Every individual, including the Supreme Court judges are consumers to airlines. Thus, they understand the transaction between a consumer and an airline and relate to the impact of cancellations and refunds. However, non-members of the travel industry are not aware of the transaction between an airline and a travel agent and thus, cannot relate to the impact of cancellations and refunds on travel agents. Only by placing this information on record will the Supreme Court be able to understand the direct losses being faced by travel agents in case of non-refunds and consequentially enable them to order accordingly,” says the firm.