Imagine booking a fully-refundable rate at a hotel, but still being charged a service fee if you need to cancel your reservation. This is a policy that Airbnb has implemented during these most uncertain of travel times.
When looking to book a future Airbnb stay recently, we noticed fine print advising that Airbnb’s service fee would not be refunded if we cancelled (despite the host having a very flexible cancellation policy) because we have already received 3 service fee “refunds” in the last 12 months.
Does Airbnb consider the reasons someone may cancel? One would assume that there have been many new reasons forcing users to cancel reservations recently, such as the ongoing and ever-changing travel restrictions both locally and internationally. Either way, even regardless of reasons, shouldn’t fully-refundable rates be fully-refundable?
During the COVID pandemic and many of the extenuating circumstances that arose, many hosts were understanding and generous in honoring refunds even if guests were not entitled to them. At the same time, stories were shared with the media about cases in which Airbnb chose to decline refunds of service fees (which can end up being $500 or more depending on the booking). Apparently some refunds were eventually issued to some travelers after the media questioned the practice. This really brought to light the question of how a host with one can open their pocketbook to refund a guest (when that may be their primary source of income) while a large corporation cannot?
Airbnb explains that their service fees are collected “To help Airbnb run smoothly and to cover the costs of the products and services we provide, like 24/7 customer support, we charge a service fee when a booking is confirmed.”
However, hotel chains and the many online travel booking sites offer these same services but generally don’t charge a service fee at the time of booking that is not refunded when you cancel within the cancellation policy. While hotels often greatly inflate the price difference between non-refundable (and often prepaid) rates and flexible rates, flexible rates are intended to offer bookers exactly that – flexibility. The booker accepts the higher cost in order to protect themselves against issues that could arise that might prevent them from travelling.
It appears to be the trend that companies like Airbnb enter a market with low fees, marketing themselves as a company that benefits all its users, in this case both hosts and guests. Once market dominance is achieved and users have less options, these types of unfair policies are applied.
We value flexibility more than ever these days and often book accordingly. We find it unreasonable to pay Airbnb a large service fee for the privilege of using their service when needing to cancel a booking with a fully refundable rate. If the host doesn’t want to penalize a customer, why does Airbnb? We would like to believe that Airbnb can find a way to meet its financial goals without resorting to disappointing policies and practices that punish it’s users.
What do you think of Airbnb’s policy about service fees for fully refundable reservations?