After the regulator found that it costs train operators and ticket retailers less than five pounds to refund an unused ticket, the industry has halved the maximum fee they can charge.

The Office of Rail and Road (ORR) carried out a review (the report of which is available here), and found that operators and retailers refunded 5.8 million tickets in 2019/2020, and were allowed to charge an administration fee up to ten pounds.

As most refunds are now processed digitally, the cost of administering a refund is less than half of that maximum fee.

As a result, the ORR called on the industry to review the cap, and from 1 April, the maximum fee that train operators and ticket retailers can charge is five pounds.

The updated National Rail Conditions of Travel, which will be available on 2 April, will contain details of the new £5 cap.

Only some types of tickets are eligible for refund, so this change will only apply to them.

Fees only apply when a passenger chooses not to travel on a service that has not been delayed or cancelled.

If a journey is delayed or cancelled, the operator or retailer will refund the fare without charging a fee.

The ORR, which two weeks ago welcomed the industry’s response to its call for more transparency about charges, sets out passengers’ rights to refunds in its document Know Your Rail Rights.

“The processing of refunds is now predominantly done digitally, which has resulted in lower administration costs. The results from our review provided industry with a clear action to make sure these savings are reflected in the refund fee, and we are pleased that the rule change will mean a fairer deal for passengers.”

Stephanie Tobyn, ORR director of strategy, policy and reform