Dive Brief:

• The Washington-based consumer advocacy group National Consumers League is urging consumers impacted by Spirit Airlines’ abrupt shuttering to contact credit card issuers as soon as possible to secure refunds. Customers “should act quickly,” the group said.
• The advocacy group is advising consumers to keep all documentation associated with their Spirit Airlines purchases and monitor their credit and debit card accounts to verify that they receive refunds, the organization said in a Saturday press release.
• “Not all Spirit customers should assume a refund will automatically appear,” John Breyault, a vice president at the league said in the release. “When an airline shuts down this suddenly, it’s up to travelers to take proactive steps to have the best chance of getting their money back.”

Dive Insight:

Tickets purchased directly from Spirit by way of a credit or debit card should be automatically refunded, according to a statement from the airline. Fliers who purchased tickets from a travel agent will need to seek a refund from them, the League said.

For customers who used a voucher, loyalty points or another method to pay, getting a refund could get tricky as it may depend on the bankruptcy proceedings, according to the consumer advocate group. The League advised keeping all booking confirmations, cancellation notices and other communication with the airline.

If affected customers don’t receive a refund in a timely fashion, the organization is encouraging them to request chargebacks. Consumers who paid for their flights using vouchers, credits, Free Spirit points or other methods may need to submit claims through the airline’s online bankruptcy website, according to the press release. 

Spirit announced Saturday that it would cease operations, effective immediately. As a result, the company canceled all of its remaining flights, stranding some fliers, and instructed its customers with upcoming flights not to go to the airport. 

As the dust settles from Spirit Airlines’ sudden shutdown, travelers who paid for their flights using points, cash, vouchers or other payment methods could wait longer to recover their refunds, and the value of their frequent flier miles may eventually decline, NCL said in its release. 

In the months leading up to Spirit Airlines’ closure, airline points have been a target of lawmakers, much to the chagrin of industry stakeholders. In March, Sen. Dick Durbin, D-IL, reintroduced the “Protect Your Points” bill, which would require airlines to provide a year’s notice ahead of any changes to their terms of service or devaluation of their rewards incentives. 

Last month, the U.S. Tourism Economy Alliance decried another bill from Durbin, the Credit Card Competition Act, which would require credit card issuers to make a card network other than Visa or Mastercard available for processing payments. The alliance said the legislation would harm consumers who rely on reward incentives to cover travel expenses, but merchant groups have long pressed for the legislation. 

Airlines have explored alternative payment options for customers who prefer debit over credit cards. Last year, Southwest Airlines and United Airlines debuted a debit card that lets cardholders accrue points and miles, but the perks sometimes aren’t as immediate as those available to credit cardholders, including cash back.