Navigating DOT mandated airline refunds: A clear skies solution

Issuing refunds to passengers in the airline industry can be a convoluted process fraught with complexity. In fact, 62% of airline and travel agency leaders said travelers think chargebacks are easier than getting a refund.¹ Despite the best intentions, numerous factors contribute to the difficulty of providing efficient refunds. However, today’s customers expect immediate resolutions. With 100k+ flights canceled annually, hearing the outdated refrain of “the check’s in the mail” simply won’t cut it.  

The U.S. Department of Transportation (DOT) recognizes the challenges of an outdated refund process and has introduced legislation mandating airlines to update and streamline their procedures. The newest legislation slated to go into effect on June 25, 2024, states that airlines must automatically refund consumers if their flight is canceled or significantly changed by a U.S. or foreign air carrier within, to, or from the United States. While travelers celebrate this new rule, the aviation industry faces a tight turnaround to ensure compliance with DOT regulations within a six-month window before penalties are imposed.

Fortunately, there is a turnkey digital solution available to enable airlines to provide seamless, secure, and convenient domestic and global payout experiences for valued customers. Latitude powered by Brightwell is a corporate disbursements solution that can help airlines quickly course-correct the customer experience when passengers are inconvenienced, all while fulfilling DOT regulations. Latitude ensures refunds are quick and easy, streamlining operations and maintaining passenger satisfaction.

How it works

It’s simple: When an airline authorizes a refund, they get a secure personalized link to send to the passenger who is owed the refund. Once the notification is received, the passenger can access the link, input their information, select their preferred receive method, and claim their funds.

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Latitude is a fully managed solution with an option that requires no coding to get started, making it easy to get up and running in just a few weeks. It can be customized to fit the airline’s branding, seamlessly integrating into their existing portal or CMS using our APIs. The Latitude experience offers white-glove client support (Tier 2) with as much or as little assistance as the client requires. This includes detailed task management to airlines and automated onboarding workflows for enhanced transparency and more confident reporting. We prioritize security and compliance, with built-in sanctions screening, Know Your Customer (KYC), AML/BSA, and transaction monitoring.  

Why it matters

Airlines need to find a solution quickly to remain compliant with the new rule, ensure a top-notch customer experience, and sustain profitability. With Latitude, airlines unlock a modern refund solution that provides multiple payout options to passengers—including to card, digital wallet, account, and cash pickup, depending on location. Coupled with a user-friendly mobile or web experience aligned with the airline’s brand, Latitude delivers on the promise of safe, simple, and seamless customer experiences for passengers around the globe.

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‍¹https://outpayce.com/en/resources/resources/research/2023/tackling-travel-chargeback-challenge

Brightwell is a technology provider and not a bank or other regulated financial institution. All regulated international transfer services associated with Latitude are provided by The Bancorp Bank N.A. Terms and conditions apply.

The foreign exchange rates shown are for illustration purposes only and do not reflect actual rates. They are provided solely as an example and shall not be relied upon for any purposes whatsoever.

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