Can Companies Legally Just Tell Customers “No Refund”?

Reloaded News Desk

You buy a bus ticket. Something happens and you cannot travel. You ask for your money back.

The attendant points at the ticket and said “No refund after payment.” You leave with nothing.

The same thing can happen with flight tickets, hotel bookings, event tickets, travel arrangements and other services. The words may appear on a ticket, receipt, invoice, website or terms and conditions.

But under Nigerian law, does printing “NO REFUND” automatically give a business the legal right to keep a customer’s money?

No.

But the law also does not create an unconditional right to a refund in every situation.

The Federal Competition and Consumer Protection Act 2018 (FCCPA) gives consumers a statutory right to cancel an advance booking, reservation or order, subject to a reasonable cancellation charge. The Act says a cancellation charge becomes unreasonable when it exceeds what is fair in the circumstances, taking into account factors including the nature of the service, the notice given, the supplier’s opportunity to find another customer and the normal practice of the industry.

That provision changes the conversation considerably.

HOWEVER THE LAW DOES NOT SIMPLY SAY “EVERY PAYMENT MUST BE REFUNDED”

Section 120 of the FCCPA gives consumers the right to cancel advance bookings, reservations or orders, but allows a supplier or service provider to impose a reasonable cancellation charge.

The law therefore recognises that businesses can suffer genuine costs when customers cancel.

A company may have reserved a seat, room, vehicle, venue or other service for a customer. If the customer cancels at the last minute, the business may have limited opportunity to sell that space to somebody else.

The law takes that commercial reality into account.

What the law does not appear to permit is turning a blanket “no refund” statement into an absolute shield against legitimate consumer claims.

Section 127 also prohibits unfair, unreasonable or unjust contractual terms and prohibits businesses from requiring consumers to waive rights or liabilities on terms that are unfair, unreasonable or unjust.

There is another important protection.

Section 128 requires certain terms intended to limit or exclude a business’s liability to be brought to the consumer’s attention before the transaction is concluded.

Section 129 goes further by prohibiting certain terms that attempt to exclude liability for matters including defective performance, negligence, misrepresentation and other statutory obligations.

In plain language, a business cannot necessarily wait until a dispute arises before suddenly producing a condition that the customer was never properly told about.

THE PEACE MASS TRANSIT CASE

The issue has already reached the courts in a Nigerian transport case.

In a case involving Peace Mass Transit, a passenger bought a ticket for a trip from Obollo-Afor to Enugu.

The journey was delayed for about two hours because of the absence of passengers. The passenger returned to the ticketing office and requested a refund of the fare he had paid. The company refused.

Its position was that its ticket carried a “no refund of money after payment” condition.

The dispute eventually reached the Enugu State High Court.

The court declared the company’s no-refund policy illegal and void and awarded ₦500,000 in damages to the passenger. The Federal Competition and Consumer Protection Commission later cited the judgment as an important affirmation of consumer rights under the FCCPA.

The significance of the case is not that every transport passenger is automatically entitled to a full refund whenever they change their mind.

The important issue was the relationship between the company’s policy and the consumer’s statutory rights, particularly where the contracted service was not properly rendered.

WAKANOW CASE: WHEN THE POLICY APPEARS AFTER PAYMENT

The courts have also considered the issue in the travel industry.

In Edem Ewa Ekeng & Anor v. Wakanow.com Limited, the claimants had booked international flights through Wakanow.

After subsequent arrangements involving changes to the trip, the travel company failed to complete the agreed rescheduling arrangements, resulting in the customers being unable to use the tickets as intended.

When the customers sought a refund, Wakanow relied on its no-refund position.

The Lagos Magistrates’ Court rejected that defence and declared the purported no-refund policy illegal, null and void in the circumstances of the case. The court also ordered a refund and awarded monetary relief connected with the company’s failure to perform its obligations.

One particularly important issue was the timing of the alleged policy.

Legal reporting of the decision states that the court found the policy, which was communicated after payment, could not bind the customers in the circumstances.

That brings us to a practical question for consumers:

When exactly were you told that the money was non-refundable?

If a business takes your money first and only introduces an important restriction after the transaction, the dispute is no longer simply about whether the customer saw the words “no refund.”

It becomes a question of contract formation, disclosure and statutory consumer protection.

WHAT ABOUT TRANSPORT COMPANIES TODAY?

GUO Transport’s current published terms state that purchased tickets are non-refundable, but also provide that tickets can be carried over for use on a future date within three months, subject to stated conditions and any fare difference. Its terms also provide for rescheduling or rerouting subject to a ₦2,000 charge and specified timing requirements.

That is materially different from simply saying that a customer loses everything.

The company has a non-refund condition, but also provides a mechanism through which the ticket can retain value.

Whether a particular application of that policy is lawful would depend on the circumstances of the transaction and the applicable law.

But a non-refundable ticket is not necessarily the same thing as a business being entitled to keep money after it has failed to provide the service for which the customer paid.

AIRLINES PRESPECTIVES

Air travel provides another useful example.

Air Peace’s current published terms state that voluntary refunds on refundable tickets are subject to a 25 per cent deduction, while Economy Non-Flexi tickets are described as non-refundable. The airline also provides procedures for requesting refunds.

At the same time, the airline’s conditions provide that where it cancels a flight or fails to operate it reasonably according to schedule, passengers may have remedies including rerouting or a refund, subject to applicable aviation laws and regulations.

This illustrates an important legal distinction; Voluntary cancellation by the passenger is not necessarily the same situation as cancellation or failure by the service provider.

The reason for the refund request matters.

The contract matters. The timing matters. The nature of the service matters And statutory rights matter.

Arik Air’s published conditions similarly distinguish between voluntary and involuntary refunds. Its terms provide for refunds where the airline cancels a flight, fails to operate reasonably according to schedule or fails to carry the passenger to the destination in specified circumstances. Its voluntary-refund provisions allow reasonable administration or cancellation charges in applicable cases.

THE AIR PEACE–FCCPC DISPUTE IS IMPORTANT

The issue is not merely theoretical.

In June 2025, the FCCPC summoned Air Peace over complaints concerning non-refund of ticket fares, including complaints relating to cancelled flights.

The Commission said such situations could contravene provisions of the FCCPA protecting consumers where advance bookings or reservations are unfulfilled because of a service provider’s failure.

In April 2026, the Federal High Court in Abuja dismissed an Air Peace suit challenging the FCCPC’s authority to investigate consumer complaints and issue summons in the exercise of its statutory powers. The judgment, delivered by Justice James Omotosho, affirmed the Commission’s power to investigate consumer complaints under the FCCPA.

That judgment did not itself establish that every Air Peace refund complaint must succeed.

The significance is different, it establishes that businesses operating in Nigeria remain subject to consumer-protection oversight, and a dispute over refunds can attract regulatory scrutiny.

WHEN A “NO REFUND” POLICY BECOMES A PROBLEM

The law and the cases point to several circumstances that deserve particular attention.

A blanket no-refund clause becomes legally vulnerable where it is being used to:

• keep money for a service that the company failed to provide;
• exclude liability for negligence or defective performance;
• impose an unfair or unreasonable term on the consumer;
• introduce an important condition only after payment;
• prevent a consumer from exercising a statutory right;
• retain money in circumstances where the cancellation charge is unreasonable;
• or otherwise defeat protections provided by consumer-protection law.

That does not mean every customer cancellation requires a full refund.

A consumer who simply changes his mind five minutes before departure may face a legitimate cancellation charge.

A customer who buys a restricted fare after being properly informed of the conditions may also have a different legal position from somebody whose service provider cancelled the service or failed to perform its contractual obligation.

The facts matter.

WHAT SHOULD A CUSTOMER DO?

The first mistake many consumers make is throwing away the evidence.

Keep the ticket, receipt, invoice, booking confirmation, terms and conditions, emails, WhatsApp conversations, SMS messages, payment evidence.

And, where relevant, photographs or screenshots showing the company’s published refund policy at the time of purchase.

The FCCPC provides a complaint-resolution platform through which consumers can submit complaints and attach supporting documents such as receipts, agreements and correspondence.

The consumer should first clearly demand the remedy sought from the company and keep evidence of the complaint.

Where the dispute remains unresolved, the consumer can approach the appropriate regulatory or dispute-resolution channel, including the FCCPC where the matter falls within its jurisdiction.

BEYOND THE HEADLINE

Nigeria’s consumer economy cannot function properly if every business can simply write “NO REFUND” on a ticket and treat those three words as the end of the law.

But consumer protection must also recognise that businesses incur real costs when customers cancel bookings and reservations.

That is why the FCCPA does not simply abolish cancellation charges.

It requires reasonableness.

The emerging judicial position is therefore more nuanced than either side of the argument sometimes suggests.

It is not; “Customers can always get their money back.”

Nor is it; “Once the company writes NO REFUND, the customer has no rights.”

The issues will be; What happened, what was agreed, when was it disclosed, what service was promised, who failed to perform, and what does the law permit the business to retain?

That is the question Nigerian consumers should be asking whenever the words “NO REFUND” appear on a ticket.

And increasingly, it is a question Nigerian courts and regulators are being asked to answer.

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