Lowcostholidays Collapse: Know Your Rights

Nearly 140,000 holidaymakers have been hit by the recent collapse of online travel retailer Lowcostholidays.  The collapse has reaped havoc on weddings, family holidays and honeymoons, with some people losing £1,000s on holidays.

In this short guide we’ll explain your rights and how to reclaim.

I’ve not traveled yet – what can I do?

Lowcostholidays is made up of several brands known as subsidiaries. If you have booked with Lowcostholidays, Lowcostholidays Spain, Hoteling.com or Lowcostbeds A.G brands, unfortunately you have been affected.

Some holidays purchased on Lastminute.com are actually booked with Lowcostholidays and are also affected, if this is the case for you, you can also use these tips below .

Check your flight and hotel bookings immediately

If you have booked with any of the above brands you need to check the status of your booking with your airline. hotel, transfer and airport companies as a matter of urgency.

  • Flight Rights – the administrator says most bookings should still stand, as payment is usually made to airlines when you have made your booking so they hold your reservation. However, not all flights have been paid for, meaning some holidays have been left without transport. If you haven’t already received your flight details from the airline, contact them directly to check your flight has been paid for and reserved.
  • Hotel and other rights – Unfortunately in most cases hotel reservations and other services booked through Lowcostholidays, such as airport transfers, won’t be paid for. This is because travel sites like Lowcostholidays typically pay the hotel 30 days after your stay. If your hotel has not been paid, the hotel may hold your reservation until you pay it. However, they may just cancel the booking so it is imperative you check before you travel. If your hotel confirms the booking has been paid for, make sure you ask for it in writing.

If you find out your hotel hasn’t been paid for you need to seriously consider if you can afford to go or not. Although a little further down we explain what you can do, nothing is guaranteed so it is safer to assume that you may have to pay twice.

Decide if you can afford to go if your hotel hasn’t been paid for

Therefore you need to work out whether paying twice fits in to your budget. The last thing you want to do is overstretch yourself if you have already lost a chunk of money.

If you decide you can’t afford to pay again, you may want to consider cancelling the whole holiday. You could try asking the airline if they will cancel your ticket, but they’re under no obligation to do so and many aren’t refundable.

Ryanair has already indicated they won’t be offering refunds for any Lowcostholidays. There has been no comment from the other airlines yet so we’ll update this when we know.

if you do go ahead and cancel your tickets then the airline may still refund some of the tax you paid in your tickets, however, as with refunds, they are not legally required to offer you this.

Check if you’re covered by your card provider or PayPal

Credit cards and prepaid cards

With the icount Money prepaid MasterCard® you are covered by purchase protection, also know as Section 75. If your holiday cost £100 or more, under the Consumer Credit Act, card providers with purchase protection are jointly liable with the retailers if something should go wrong, such as firm going bust, meaning you may be able to get a refund from the card provider.

It is important to understand that although there is strong chance of Section 75 working,  for it to work there must be a direct link between the product you have paid for and the debt. If there is an intermediary or an agent, the link can be broken which would invalidate Section 75.

The rule of thumb is, if you bought you hotel and flight from Lowcostholidays, then this was a Lowcostholidays package and in this instance Section 75 should work. But, if you used them just for your hotel, it was more than likely an agent.

Section 75 is undoubtedly more powerful, but VISA, MasterCard® and Amex credit cards also have ‘chargeback’ protection (explained in more detail below). You might want to consider using chargeback to claim as well, some banks let you do both. If you want to go down this route, check with your bank first to see if they’ll let you.

You can find more about Section 75 here

Debit cards

Unfortunately if you paid on debit card, Section 75 doesn’t apply. However, you may still be able to claim on the chargeback scheme, where you get the money back from the retailers bank if something goes wrong.

Again, it’s important to understand that this is not a legal requirement, it is a customer service promise, but still worth trying.

in most circumstances you have to submit your claim within 120 days before your holiday start date to benefit from chargeback, according to the Financial Ombudsman.

HSBC, RBS, Barclays, Halifax and Lloyds have confirmed they will offer the chargeback scheme to any Lowcostholiday customers who have been affected. Please be aware though, even if you’re able to put in a claim, it is not guaranteed to be successful.


If you paid using PayPal, the good news is you’re covered by it’s buyer protection scheme. You MUST open a dispute within 180 days of paying to claim your money back so don’t delay!

Bank transfers

If you paid by bank transfer or any other method such as cash , sadly you would not be able to try any of these routes. Advocating the use of cards over cash even further.

Final word

You need to act quick to stand any chance of getting your money back. make sure you have contacted all the relevant companies to ensure you know exactly where you stand. This is no time to bury your head and hope for the best.

On behalf of everyone at icount, we sincerely wish you the best of luck with your claim.


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