San Francisco headquartered home rental platform Airbnb has set up a $250 million fund to offset the losses incurred by hosts due to Covid-19 cancellations.
The company will pay hosts 25% of what they would typically get through the cancellation policy for the period between March 14 and May 31, Brian Chesky, co-founder of the company, said in a letter to hosts.
Visitors, on the other hand, will get a full refund in cash or travel credits for cancellations made during the same period, the letter added.
While the company’s employees contributed $1 million to the fund, the rest was put in by co-founders Brian Chesky, Joe Gebbia, and Nathan Blecharczyk.
The move comes amid the company’s statement on March 17, which said only visitors would obtain a full refund for cancellation of reservations, which angered several hosts.
Additionally, the company has pledged $10 million to its Superhost Relief Fund. The fund is designed for the ‘superhosts’ on its platform -- these are hosts who rent out their own homes. Chesky said these hosts may require help paying their rent or mortgage, and could also be long-tenured hosts trying to make ends meet.
Chesky said the move was made keeping in mind public health and safety.
"Please know this decision was not a business decision, but based on protecting public health. However, while I believe we did the right thing in prioritising health and safety, I’m sorry that we communicated this decision to guests without consulting you—like partners should," the letter said.
Additionally, the company has also put in place a programme, expected to go live by April, for users who want to help their hosts directly.
"We are making it easy for your previous guests to send financial support directly to you. We are creating a way for guests to send a note along with a contribution to any of the hosts who they’ve previously stayed with,” Chesky said.