A regulator says 44,000 customers of LoveHolidays awaiting refunds for trips cancelled because of the coronavirus pandemic, will get their money back by the end of March.
The Competition and Markets Authority (CMA) said the online travel agent agreed a series of undertakings to meet its obligations after it received hundreds of complaints from consumers related to repayment delays.
It is the latest refund intervention made by the watchdog following similar action against Lastminute.com, TUI UK and Virgin Holidays.
The CMA said LoveHolidays customers had been told by the company that the reason for repayments being withheld was due to airlines dragging their heels - with Ryanair reportedly among them.
But, under the terms of the agreement with the regulator, customers will get their money back in two instalments by the March cut-off date.
A total of £7m has been returned to 20,000 customers to date.
Andrea Coscelli, chief executive of the CMA, said: "Travel agents have a legal responsibility to make prompt refunds to customers whose holidays have been cancelled due to coronavirus.
"Our action today means that LoveHolidays' customers now have certainty over when they will receive their money back and they will receive this without undue delay.
"We are continuing to investigate package travel firms and where we find evidence that businesses are breaching consumer law, we will not hesitate to take enforcement action to protect consumers."
The CMA said any failure by the company to meet its agreed timetable for refunds could result in court action.
A spokesperson for LoveHolidays responded: "We sincerely thank our customers for their continued patience, and apologise that it has taken much longer than normal to process their refunds.
"Whilst we've made significant progress, there is clearly more to do, especially on airline refunds, and we urge all parts of the tourism sector to work together to ensure that customers are refunded as quickly as possible."
