Jenny Ross: Some banks boost faith in the industry

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Holding companies to account is one of the many ways Which? fights for better outcomes for consumers.

In the past few weeks alone, you may have read about our criticism of Barclays’ decision to stop customers withdrawing cash at the Post Office (one it has now reversed), our warning that some airlines appear to be exaggerating their Black Friday ‘deals’, or our call for stronger regulation of online marketplaces after finding that Amazon and eBay aren’t taking basic steps to stop listing toys for sale that appear to have been declared unsafe by the EU’s safety alert system.

But as part of our mission to improve standards for consumers and help people make informed decisions, we’re also keen to shout about companies getting it right.

So in that spirit, I wanted to share a couple of recent personal experiences that have boosted my faith in the banking industry.

The first began with an unexpected transaction on my current account statement: £105 had been taken by Malmaison Hotel in Edinburgh, despite me never having stayed there. It wasn’t a total mystery – I’d made a reservation several months ago via Hotels.com but had to cancel, which I was able to do for free.

But clearly communication between the booking site and the hotel had gone awry, as I was still charged. Cue an excruciating series of phone calls to try to get my money back where I was bluntly told by Malmaison that I needed to speak to Hotels.com, and vice versa.

Thankfully, I knew I had another avenue to try. I called my current account provider (Nationwide) and said I wanted to raise a chargeback dispute.

Chargeback is a little-known scheme that can help you get your money back if there’s a problem with a card purchase – for example, if the retailer goes bust before you receive the goods or you’ve been wrongly charged, as I was.

Unlike Section 75, which covers purchases of between £100 and £30,000 made using a credit card, it’s not a legal protection. It’s a process agreed between financial institutions and the relevant card scheme (American Express, Mastercard or Visa). But it can cover both debit and credit card transactions, and there are no restrictions when it comes to the value of the purchase.

You should attempt to get your money back from the retailer before you can complete a chargeback request. If, like me, you reach an impasse, contact your bank as soon as possible as there’s a time limit – usually 120 days from the date you paid for or received the goods.

You’ll be expected to supply any relevant evidence supporting your claim. For me, this just meant forwarding Nationwide an email I’d received from Hotels.com confirming that I had cancelled my booking within the free cancellation window.

The call handler I spoke to at Nationwide immediately opened a case for me and was clear about what the process would involve from that point – my claim would be reviewed in the next 10 working days.

On the tenth day, I was pleased to see my missing £105 had been credited back to my account.

It can take a month or more for banks to settle chargeback claims with the retailer, so there’s a chance that the refund could be reversed if the retailer end up rejecting the chargeback. But whatever happens in my case, I was impressed at the efficient service I received from Nationwide – especially after the frustrating experience I’d had trying to resolve the issue directly.

Unfortunately this rogue transaction wasn’t the only one in our household this month. While on holiday in Athens, my boyfriend was parted from his wallet by a pickpocket on the metro. Not that he realised at the time – it was a mobile notification from Monzo later that evening that alerted him to several payments being made on his card at a nearby petrol station.

The good news is that ultimately you won’t be left out of pocket in this situation. Banks must refund unauthorised card transactions and restore your account to the state it would have been in before.

But Monzo’s real-time notifications every time you spend on your card mean you can pick up on any fraudulent payments straight away.

As soon as he received the spending notifications, Joe logged into his Monzo account, as well as his other banking apps, to freeze his cards (Monzo was one of the first to introduce this function), before contacting each one to report the theft.

All four providers (two debit cards and two credit cards) dealt with the fraud exactly as you’d hope, immediately cancelling and reissuing the cards and refunding the stolen money. We could quickly return to happier holiday tasks, like tracking down the best souvlaki in the vicinity.

Previous Which? research suggests that not all fraud victims can expect this level of service.

In our November 2018 survey, for example, 18 per cent of credit card customers who’d reported unauthorised transactions in the past two years said they had to wait more than two weeks to be reimbursed, with 5 per cent waiting longer than four weeks – far from ideal when the rules say customers should be refunded ‘without undue delay’.

Similarly, the gulf between ratings achieved by banking brands who come out at the top and bottom of our annual customer satisfaction surveys highlight the fact that not all are created equal. Don’t settle for subpar service or poor-value products – vote with your feet and switch to a bank that does better.

Jenny Ross is Editor of Which? Money