If a company goes out of business, can I get a refund from Groupon?

refund from groupon

After Michelle Crews buys a Groupon for a cleaning service, the business closes. Can she get a refund from Groupon?

Question

I paid $59 for a voucher for housecleaning services through Groupon recently. But when I tried to redeem the voucher, I couldn’t reach the merchant via phone. The number was not in service. I then searched for the company to get more information, but I was unsuccessful.

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I reached out to Groupon and advised them that I could not use my voucher and it seemed as if the merchant is no longer in business. Groupon has been “investigating” it, but it’s taking a long time to resolve. They have not provided me any information on this “investigation.”

I requested a full refund from Groupon, but they claim they can only refund me in Groupon Bucks. I do not want a credit. This is not my fault, so why am I ineligible to receive a full cash refund? — Michelle Crews, Bartlett, Tenn.

Answer

You should not have to pay for something you couldn’t use. But are you entitled to a refund?

Short answer: no. At least not according to the Groupon Promise, the company’s terms and conditions. According to the agreement, any unredeemed voucher may be returned within the first three days of purchase for a refund of the amount paid. “After that, Groupon will not refund any voucher and all sales are final unless otherwise stated in the Fine Print.”

And what does the Fine Print say? “Unredeemed Local Groupons that are not Final Sale will be eligible for a refund to Groupon Bucks or self-service Trade In through your voucher’s expiration date.”

So the Groupon Bucks are allowed. But who has the time to read the fine print, anyway?

But Groupon’s contract doesn’t really address a company that goes out of business. That’s becoming more of an issue during the pandemic.

Were you entitled to a refund from Groupon?

Bottom line: You weren’t entitled to a refund. But you should have been. After all, you paid for a product or service that couldn’t be delivered. Under the Fair Credit Billing Act, you could file a dispute with your credit card and receive a full refund. And if you hadn’t contacted me with this problem, I think a credit card dispute would have been a quick way to fix this. I believe you would have been successful.

By the way, I checked out the business and it appears to be gone. But I also found a lot of negative reviews, which didn’t surprise me. Next time you buy a product or service through Groupon, or anywhere else, please take a moment to read the online reviews. You might be able to avoid a future customer-service disaster.

If you wanted to skip the credit card dispute, you could have also reached out to one of the Groupon executives via email. I list the names, numbers and email addresses of the Groupon managers on my consumer advocacy site, Elliott.org. These contacts have worked for other readers in the past.

I contacted Groupon on your behalf. It refunded the full amount of your purchase.