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OYO Indonesia in hot water after refund and payment complaints go viral
“OYO uses the pandemic as an excuse to delay payment [..] They have been avoiding payment since February, before the COVID-19 outbreak in March,” a vendor has said.
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An OYO hotel room in Jakarta. OYO Indonesia said it had prepared one of its hotels to accommodate medical personnel fighting the COVID-19 pandemic. (OYO Hotels and Homes Indonesia/-)
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ustomers and partners of budget hotel operator OYO Indonesia have taken to social media to voice their complaints of neglect by the India-based company, as many encountered refund and payment problems for months.
Instagram account @oyobikinrugi_ (OYO causes losses) has gone viral for sharing stories from OYO’s customers and partners that detail how the company has reportedly failed to address refund and payment issues, among other things.
One customer who shared her story with the account is 26-year-old Putri (not her real name). In June, she found that the hotel she booked in South Tangerang had gone out of business.
“It was around 4 a.m. I was neither able to contact the hotel owner nor OYO. Thankfully, there were other hotels around, so I checked into one of them,” she told The Jakarta Post on Aug. 14.
Putri said she then asked for a Rp 475,000 (US$32) refund on June 8 and OYO replied on June 11 saying it had transferred the amount. However, she claims to have never received the refund in her bank account.
After receiving no further explanation from OYO for three months, she thought of reporting OYO to the National Consumer Protection Agency (BPKN).
“I know it is only a few Rp 100,000 but this is predatory behavior toward their consumers and partners. I hope OYO Indonesia gets evaluated,” she said.
Bagus Panuntun, who does renovations and provides printing services in Lampung, said OYO only paid him Rp 150 million out of around Rp 300 million owed for jobs he took last year.
“OYO told me that I can either accept half of the payment in June or full payment when the Indonesian government declares that the COVID-19 pandemic is over,” he told the Post in a phone call on Aug. 14.
Bagus went on to say that he chose the first option as he needed the money to pay his employees’ Idul Fitri holiday bonus (THR) in May.
“My firm has done its job since February, but when I ask for payment, OYO always delays,” he said.
Bagus, who had worked with OYO for almost two years, said the first year of the partnership went smoothly. However, at the beginning of 2020, OYO Indonesia’s Lampung representatives were kept in the dark by the company’s central office in Jakarta about payment issues.
“OYO uses the pandemic as an excuse to delay payment [..] They have been avoiding payment since February, before the COVID-19 outbreak in March,” he said.
Read also: Pandemic erases $5.9b of Indonesia’s tourism revenue
The @oyobikinrugi_ administrators said people had been complaining about OYO since last year.
The account operators, who consist of a group of people whose complaints were not responded to by OYO, said it had collected data on 45 OYO consumers, partners and vendors, who collectively claimed losses of up to Rp 4 billion.
“The first time OYO Indonesia reached out to us was through their legal representatives,” they said through email on Aug. 13, adding that OYO had sent legal notices addressed to the account, once in June and twice in July.
The group said it wished OYO Indonesia would immediately pay what they owed to their consumers, partners and vendors.
“If a global company such as OYO is struggling during this crisis, imagine the hardships for small partners and vendors,” they said.
“We also wish for an official investigation into OYO’s business in Indonesia. We want OYO to admit their wrongdoings and apologize. After that, we still want to pursue legal action,” they added.
However, some consumers, partners and vendors that have reported their cases to the BPKN, Finance Ministry, the Business Competition Supervisory Commission (KPPU) or the police have received repayment from OYO, the group said.
OYO Indonesia said on Tuesday that it would release on official statement addressing the matter soon but did not respond to the Post’s inquiry at the time of writing.
However, OYO spokesperson told dailysocial.id in June that it denied the allegations of neglecting refund requests, stating that refunds could take a long time due to problems during the validation process.
“We apologize if our customers experienced any inconvenience. Our system is not perfect and we are constantly evaluating our services,” the spokesperson said.
Read also: OYO provides rooms for 'healthcare warriors' battling COVID-19
BPKN vice chairman Roslan Sitinjak said 109 reports had been made regarding refunds during the pandemic, 85 of which were hotel and travel tickets refunds. He further noted that there were 31 complaints addressed to OYO and 27 addressed to Traveloka.
“We asked businesses to immediately process consumer refunds,” he told the Post on Tuesday. “And we urge consumers to report to the BPKN website if you are having trouble getting your refund.”
In April, OYO CEO Ritesh Agarwal said the company had seen its revenue and occupancy drop by more than 50 percent, which led to the company furloughing its 400 Indonesian workers, half of its entire staff in the country in June.
OYO investor SoftBank Group had forecast a record 1.35 trillion yen ($12.5 billion) in operating losses for the fiscal year ended in March.
Among factors was the slump during the pandemic and that Agarwal had borrowed around $2 billion to buy more shares in his own company, in which SoftBank's Masayoshi Son personally guaranteed the loans.
