Raffles

Flybe had £50m withheld by the card companies, apparently.

That said, there is no sign of this 'offer' on their website even if you go through the booking process. I am also tempted to believe it falls foul of the UK payment laws since it would effectively create a surcharge for card payments.

Scandinavian traveler

It says in Danish: "With this campaign you will earn an extra 4 % CashPoints by paying directly from your online bank" under the red button.

It may be that it is only flights included in this campaign, but I received the same offer of 4 % extra cash points last week (on Wednesday) on another global campaign and have seen it a few times before that.

DYKWIA

There is no difference in the price being paid, so there's no "surcharge" from what I can see.

It's just like BA saying they'd give an extra 4% Avios if you book by cash rather than CC.

LiHS

Lufthansa offer SEPA direct debit and Sofort as payment options (maybe others as well), and the latter is kind of a bank transfer, while a direct debit is at least bank-transfer-adjacent. I think OS might offer a straight up bank transfer though.

I've come up a reason why they might offer it, but this is all speculation. In some more cash-oriented countries, like Germany, there's a segment of the (older) population with plenty of money, but a distrust of cards. They have debit/bank cards, but those usually have a relatively low limit for purchases, certainly much lower than a couple of LH/LX F tickets to a far-off land. This gives LH an alternative means of getting their money without sending them to an office. And even for cheaper tickets, some might consider Sofort a safer form of payment because they're more used to it - both Sofort and SEPA are commonly accepted methods of web-payment in Germany, often listed next to PayPal. I'm not sure because I've never used either, but I seem to remember they were once marketed as safer alternatives to cards for online purchases, and that might have stuck in some people's minds.

All this is obviously a very different situation than what DY/DI/D8 is dealing with.

Hannibal Lecter

The DY share fell another 10% today

alexwuk

Exactly this. As Credit Card companies remain liable for refunds when merchants go bankrupt under Section 75, they effectively act as a credit insurer for their merchants - since the Merchant Fee payment remains the same regardless of the merchant risk, the only way the Credit Card companies can protect themselves from the losses caused by a merchant bankruptcy is to retain (ie withhold) more and more funds from the merchant as they enter difficulties to use to cover the costs of the eventual failure.

This creates a self-fulling prophesy in pushing failing companies into bankruptcy, but its a rational consequence of Section 75 style consumer protection laws.

Bohinjska Bistrica

Looks like Korean Air is in a trouble if this keeps up.

mobile.reuters.com/article/amp/idUSL4N2B2377

Edited to add in link and summary in line with forum rules.

Tim_T

Norwegian shares have continued to drop, down to 1usd today, from 5usd in February

HarbourGent

No chance the Korean government would let it go to the wall.

WHBM

Indeed. Commonly not realised is that Visa/Mastercharge etc are just a payment transfer organisation. There is a separate group of finance companies, Merchant Card Processors, who are the intermediary between the shop counter, or the airline booking page, and the mainstream card companies. That's how there's just one machine on the shop counter rather than one for each card company. The MCP passes the funds on according to a timetable determined by a creditworthiness formula. For airlines, if you are BA, a reasonable percentage will go through on booking, the rest on the day of the flight. For Flybe at the end it was pretty much all being held back until the flights were taken. This is where the money to refund everyone after the failure comes from - it's your own money that was never passed on to the airline in the first place. There are all sorts of electronic transactions back and forth you are not aware of that facilitate this. In the airline Balance Sheet, for those who look at these, it is shown as an Accounts Receivable, but obviously not one collectable if you go bust. BA can move its business around the MCPs and thus strongarm their arrangements; Flybe would not have been able to.

For shops, and particularly mail order, some of the funds are not released until well after delivery to cater for people claiming refunds for non-delivery, etc, known as Chargebacks - for which the business is both charged an individual fee and also their creditworthiness and timely passing on of funds can be knocked back, or they even lose the ability to take cards. Airlines pretty much don't have much in the way of Chargebacks, but even here there can be a few such situations.

antichef

A useful description of the system. Thanks.

I booked flights with FlyBe in the afternoon before the collapse, but my payment is still shown as gone through (rather than pending) by Barclaycard CC account - I am awaiting a refund under s75 of CCA. As it was only a day after the monthly payment was made they will have a full month to sort it out before they take any of my actual money!

milkyway88

The US travel ban from Europe, has got to be the straw that breaks Norwegian's back.

JohnnyCarmello

Gone by the end of next week I bet.
As Norway in in the EEA, do state aid rules apply?

HFHFFlyer

IAG must be rubbing their hands in delight. They have the cash to see this crisis through, and then feast on their competitors' carcasses once the storm has passed.

Tim_T

Norwegian down another 20% this morning