Instant Booked Guests and then they cancelled booking

[Pauline32]

Hi, I had a guest 'instant book' yesterday at 6.30pm to stay tonight and after I told them I was actually an hour away from where they thought they wanted to stay, they asked me to cancel it. I agreed but then looked into it and decided against it because of the 'penalties' (this is my first cancellation and potentially only my third guests) There were quite a few messages going back and forward, even one telling me they would leave a nice comment if I cancelled it for them. I said no, so it was eventually cancelled it by them at 11.21pm yesterday evening, now I have a request for their money back. Ive set my refund policy to moderate but in all honesty im not sure how that goes and If i dont reply in 72 hours Airbnb get involved. Im not sure what to do? Its not my fault that they booked the wrong place (they booked it before i could answer their question) but at the same time i feel bad. They have been members since summer 2015. Any help is appreciated, thank you.

[Gerry-And-Rashid0]

It's entirely up to you - your cancellation policy was applied fairly. However, it does seem like they made an honest mistake as they realised afterwards how far away you were from where they wanted to be. Personally I would refund them as it was such a short notice booking and clearly a mistake on their part. They won't get a refund on the fees they have paid - so be clear if you decide to refund that you are refunding what you would have received and not any fees as these are taken by AirBnB

[Andrée2]

If it was me, I would split the difference and give them half back. It's not your fault that they did not observe the map to determine their location but you did originally offer to give them money back. Now fortunately they have cancelled and saved you a penalty AND a negative review so you can give some of that fortune back to them.