Thought It Was Discounted but Cashback Reward... Accommodation Voucher 'Deception' [Hutdari Economy]

(45) The refund process is complicated and complex
Refund conditions vary by accommodation category, requiring caution

Editor's NoteMany people thought they were engaging in smart economic activities to get something better, but it often turned out to be a misstep. When deceived by corporate marketing or blinded by momentary gains, wrong decisions ultimately harm consumers. We aim to examine economic activities where people have made mistakes by misjudging everyday situations.

If you purchased accommodation vouchers at a discount through a lodging platform, you should double-check the amount you actually paid. This is because the final payment amount shown to consumers is often not the discounted price displayed but rather an amount assuming cashback will be received after completing subsequent application procedures. Since refund policies vary by category such as hotels or motels, you should also consider the refundable dates or deadlines before making a payment.

The Agoda app displays the price after applying the cashback reward, not the discounted final amount.

According to the travel industry on the 10th, Agoda displays accommodation fees on its platform as discounted rates but returns the discount amount as cashback. For example, a 150,000 KRW accommodation voucher may appear as if it is 10% discounted to a final price of 135,000 KRW, but the actual amount the consumer pays is 150,000 KRW. The 15,000 KRW is refunded in cash only after the stay period passes and the consumer applies for cashback. If the application is not made by the specified deadline, the refund is not possible.

Agoda excludes customers who apply the cashback reward (a service that refunds cash via credit card or other means after a certain period following reservation and stay) promotion from the Agoda Best Price Guarantee. Consumers have expressed dissatisfaction, saying, "There is no statement that the Best Price Guarantee does not apply if cashback rewards are used."

The Agoda Best Price Guarantee is a unique service that refunds the difference if the purchased accommodation voucher is not the lowest price. To apply for the Agoda Best Price Guarantee, you need up to three screenshots from the website showing the URL link with a lower price posted, hotel name and location, room availability, room type, promotion type, and room rate clearly. The claim must be submitted by 11:59 PM the day before check-in.

Many find this service difficult and complicated to use, making it hard to actually benefit from it. Although proof documents must be submitted, the process of exchanging emails and waiting often causes consumers to miss the claim deadline. There are also complaints about poor connectivity with the customer service center.

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Consumers are also dissatisfied with the difficulty of cancellation and refunds when booking through lodging platforms. For example, on the lodging platform Yanolja, some products cannot be canceled even if cancellation is decided within minutes after purchasing the accommodation voucher. When a consumer complained about the inability to cancel a hotel accommodation voucher, the customer service representative explained that refunds are possible within 15 minutes if booked under the motel category, but refunds are not possible on the same day for hotels. This consumer expressed dissatisfaction on an online community, saying, "I didn’t know the refund policy differed by category," and added, "If I had known that same-day refunds were not possible before payment, I wouldn’t have made a hasty payment."

According to the Korea Consumer Agency, there were 4,118 consumer damage relief applications related to accommodation use over the past three years (2021?2023). By year, there were 1,047 cases in 2021, 1,428 in 2022, and 1,643 last year, showing an increasing trend annually. As of September this year, 1,449 cases have already been reported.

Notably, 2,374 cases, nearly half of the complaints, involved contracts made through major lodging platforms such as Yanolja, Agoda, Naver, Airbnb, Booking.com, and Tmon. Among the issues, complaints about penalty fees upon contract cancellation were the most common at 78.5% (3,234 cases). This was followed by complaints related to hygiene, safety, and facilities at 11.9% (492 cases), and insufficient information provision regarding accommodation use at 6.2% (256 cases).

Some lodging facilities refuse refunds unconditionally regardless of the timing of the cancellation request, citing prior notification of non-refundable terms in their policies. Professor Kim Si-wol of Konkuk University’s Department of Consumer Studies emphasized, "The Fair Trade Commission should establish standards for lodging platform services and refund policies and publicly notify them so that consumers can properly check and utilize the information."