A mediation proposal has been issued requiring card companies to refund payments to consumers who purchased travel products on installment during the ‘Tmon·Wemakeprice incident’ but were unable to use the services.

The Financial Dispute Mediation Committee of the Financial Supervisory Service said on the 9th that at a meeting held on the 8th, it determined that the right of withdrawal exercised by A and others against the card company was legitimate.

According to the FSS, on February 17, 2024, A bought an approximately 4.94 million won travel package to Sydney, Australia through a travel agency listed on Tmon, paying in three monthly installments. The departure date was July 29 of the same year, and A completed payment in full over the three months.

However, about a week before departure, on July 23, the seller notified A, “We cannot perform the travel contract because we have not received settlement of the payment from Tmon.” A canceled the payment through Tmon and exercised the right to withdraw (installments) with the card company.

Under the Installment Transactions Act, consumers may exercise the right of withdrawal within seven days from the day they receive the contract or within seven days from the day the goods are actually supplied. The issue in A’s case was whether the right could be exercised even though the ‘goods’the travel servicehad not been supplied.

Taking into comprehensive account the special circumstances that led A to withdraw and the inequity of shifting to consumers the business’s risk of unsettled payments, the committee concluded that the right of withdrawal can be exercised even when the goods have not been supplied, and it ordered the card company to refund the full amount.

The committee also determined lawful the exercise of the right of withdrawal by B, who purchased Jeju Air tickets on installment through a seller listed on Tmon on May 13, 2024 and was later notified the tickets could not be used, and it ordered the card company to issue a full refund.

This mediation takes effect if the applicant and the card company accept it within 20 days. If the parties do not accept the committee’s decision, they may proceed to litigation, and the FSS will support the applicant’s lawsuit if necessary.

The FSS plans to swiftly facilitate private settlements between consumers and card companies in other disputes over travel, airline, and lodging products as well. As of the end of last year, a total of 11,696 complaints regarding installment payments for travel, airline, and lodging products had been filed with the FSS and card companies, amounting to about 13.22 billion won.

The FSS stated, “We will work to ensure that private settlements between financial consumers and card companies are reached swiftly and efficiently for other travel, airline, and lodging products as well.”