If you’ve paid for goods or services on a credit card and something goes wrong, you’ve got more rights than you might think. It sounds a bit legalistic, but section 75 of the Consumer Credit Act can help you get your cash back. And it covers a huge range of problems, for example if your online shopping doesn’t turn up, or the business that’s building your conservatory goes bust or you’ve been tricked into taking out a dodgy timeshare.
There’s loads of ways to pay for things when you go shopping. But no matter whether you’re online or on the high street, you have certain rights if you pay by credit card that you don’t have if you pay by other methods.
Paying for goods or services with a credit card (or certain other types of credit agreement), gives you statutory protection if something goes wrong under the Consumer Credit Act. This means that you can ask the card provider to give you a refund if the goods or services you’ve paid for don’t turn up or are “misrepresented” (in other words, what you’ve been sold isn’t what you were told it would be).
These claims are made under what’s known as section 75 of the Consumer Credit Act. This is an useful piece of legislation that many people don’t know about. In theory, you can make a claim if the seller goes bust, or if you’ve only partially paid for the goods on a credit card.
It’s not all straightforward though. Claims made under section 75 have to meet certain criteria and are looked at on a case by case basis by the card provider.
So how do you know if you’ve got rights under section 75?
If you pay for goods or services on a credit card that cost between £100 and £30,000, the credit card provider is jointly responsible, along with the supplier of the goods or services, for any breach of contract or misrepresentation. This can involve goods not turning up, items that are damaged or don’t do what they are supposed to do or situations where you’ve been misled by the supplier.
You don’t need to complain directly to the supplier either – but we strongly recommend you do. In fact, make the same complaint using Resolver and cut and paste the same information.
You’re even covered if you’ve only paid for a deposit for something on your credit card – as long as the deposit cost between £100 and £30,000. In cases like this you’re still covered for the whole value of the item in question. So if you pay a £2 deposit for a sofa that costs £2,000 on your credit card and the rest in cash, if the firm goes in to liquidation the card provider would in theory have to pay you the full £2,000. In fact, the wording around deposits is pretty unclear, so in theory, even if you’d paid a pound on deposit you might be covered. “Might” is the key word in that sentence.
Much as we love the Consumer Credit Act, it’s pretty old (1974 originally) and though it’s been updated a few times, the way it’s worded doesn’t always fit with the way we live and shop today.
For example, you may not be covered if you’re paying for something using an electronic payment system like PayPal or don’t buy direct from the retailer.
There are loads of other quirks too – but you’ve got way more rights than using other ways to pay.
James Walker is the founder of online complaint-resolution service Resolver.co.uk