Airbnb paying $356 million to hosts for allowing no-fee guest cancellations

Brian Chesky, co-founder, CEO, and Head of Community of Airbnb, emailed the platform’s hosts on Thursday, March 30, to provide information regarding how the company will be supporting them through the COVID-19 crisis.

In early March, Airbnb posted an update regarding a new “extenuating circumstances policy” describing how some bookings could be cancelled without incurring cancellation fees if they were impacted by the coronavirus pandemic.

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However, the company failed to communicate this information to hosts before they announced the new policy to guests.

Needless to say, some were not pleased.

Airbnb has since updated its policy.

Now, guests with reservations booked before March 14 beginning on or before May 31 can cancel their reservation and get a full refund or travel credit if their plans were impacted by coronavirus and they are unable to travel.

In the email, Chesky describes that it has been a devastating time for everyone.

“On March 11, when the World Health Organization declared a pandemic, we were faced with a dilemma,” he writes.

“If we allowed guests to cancel and receive a refund, we knew it could have significant consequences on your livelihood. But, we couldn’t have guests, and hosts feel pressured to put themselves into unsafe situations and create an additional public health hazard. ”

Chesky explains that the company’s decision to allow guests to cancel and receive full refunds — including all service fees — was not a corporate decision but a choice made to protect public health.

However, he did apologize for not consulting hosts.

“While I believe we did the right thing in prioritizing health and safety, I’m sorry that we communicated this decision to guests without consulting you—like partners should,” Chesky states.

“We have heard from you and we know we could have been better partners.”

Chesky continues that, although the sentiment may not have been communicated effectively, Airbnb and its hosts are partners, and when their businesses hurt, the partner’s business hurts as well.

“We know that right now many of you are struggling, and what you need are actions from us to help, not just words.”

In hopes of helping rectify the situation, Airbnb is paying $250 million ($354 million CAD) to aid in covering the costs of all coronavirus-related cancellations.

Now, when guests cancel their bookings due to coronavirus-related circumstances, for reservation with a check-in date between March 14 and May 31, Airbnb will pay hosts 25% of what they would normally receive through the standard cancellation policy.

Guests with bookings scheduled on or before March 14 are still able to cancel and acquire a full refund or travel credit equivalent to the total amount that they paid.

For more information, hosts and guests can visit airbnb.com/250msupport.

The company is also creating a $10 million ($14 million CAD) Superhost Relief Fund designed for Superhosts who rent their homes who may need assistance paying rent or mortgages, as well as Experience hosts who need financial assistance.

Beginning in April, hosts can apply for grants of up to $5,000 ($7,083 CAD) without having to pay them back.

As well, after receiving communications from guests expressing their gratitude for hosts being flexible during this time, Airbnb is also creating a method in which guests can send notes along with financial contributions to hosts that they have stayed with previously.

Finally, for American hosts, Airbnb has collaborated to procure support for hosts in the US Government’s new COVID-19 Stimulus Bill.

Now, hosts in the US can utilize relief measures, such as unemployment assistance, as well as small business grants and loans.

“My commitment to you is to rebuild our partnership,” Chesky writes.

“Trust is the foundation of a partnership, and it is built over time. We know that we have some work to do in strengthening yours, but it’s our priority and we are committed to it.”