If it sounds too good to be true, it may be. With airlines eliminating fees these days, it's getting harder and harder to tell.
The COVID-19 pandemic has been a reckoning for the travel industry in a lot of ways, including us, but one of the biggest changes was airlines eliminating change and cancellation fees for almost all fares across the board in order to entice people back on the road.
Free cancellation doesn't necessarily mean everything will go back on the credit card. If anything, all it means is that the airline may offer you a credit toward a future flight.
This also applies if a flight is changed to a cheaper flight: Though it's possible to have the option of a refund, expect the difference to be credited as a credit.
It's all part of a move to keep cash in the airlines' coffers, and to cover their expenses as they recover from the pandemic.
More or less, in airplane lingo:
Change = Possible credit / maybe back to original form of payment
Cancellation = Possible credit / maybe back to original form of payment
Refund = Back to original form of payment
For instance, we recently purchased a JetBlue flight from New York (JFK) to Los Angeles (LAX) for $252.41. The changed flight was only $222.40, meaning we were entitled to a refund or credit of $30.01.
Unsurprisingly, we were offered $30.01 in TravelBank credits.
In short, it is possible to have free change and cancellation on a flight but have it be nonrefundable.
Nope, it's not possible to pull the money out of TravelBank; these are typically use or lose within one year, though it may be possible to get them reissued if they expire.
Moral: Read the fare carefully, and even then, you may just want to know what free cancellation really means.