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Billion pound battle for holiday refunds reaching crunch point

A £7 billion battle for holiday refunds is reaching crunch point.

As coronavirus struck, there was a global travel shutdown with millions of trips cancelled.

The law is clear that customers are entitled to a rapid refund.

They don't have to wait. They don't have to accept a voucher. And they don't have to settle for just re-booking.

Behind the scenes, things are not nearly so straightforward.

Consumer groups such as Which? have been inundated with cases of people denied prompt refunds.

The government has been criticised for failing to give greater clarity and is being lobbied by the travel trade to relax the rules - allowing firms more time to pay.

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We spoke to Fiona McGowan whose family saved 25 years for a £20,000 holiday to Japan and are now overdue a refund.

She is furious that government could even consider changing consumer rights and told ITV News: "I cant believe we are even considering that.

"These companies are far better equipped to deal with weathering this storm than the individual is".

There was a similar reaction from Claire Evans, who was offered a voucher after her Florida trip was cancelled.

"The government are supporting everything else at the moment, I don't think they should want to put people in a worse situation when some of these businesses are owned by millionaires," she said.

Travel Regulations require refunds within 14 days of package holidays being cancelled, 7 days for flight only.

Millions of customers are affected by the cancellation of holidays. Credit: PA

Travel industry body ABTA says: “Refunds should be given as soon as possible.

"However, the worldwide travel shutdown has led to a huge volume of holidays being affected.

"Many travel agents and tour operators are unable to provide immediate cash refunds because they have not yet received money back from airlines and hotels, so they need more than 14 days to process refund requests."

The refunds' battle involves millions of customers.

Insiders expect government to issue new guidance in the next few days.

It's not only holidays that could be lost - but also trust in this industry.