James Walker: Protect your cash when big names bite the dust

Credit card payments are covered by the Consumer Credit Act
Credit card payments are covered by the Consumer Credit Act
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The high street as we know it has changed forever. Last year, 43 brand names went bust, closing 2,594 stores. And in the first two months of 2019 a further 15 brands vanished from the shopping centres for good.

The past few years have seen some pretty big names bite the dust too. So understandably, lots of the people I speak to are concerned about what happens when a business goes bust after you’ve paid them money but haven’t got what you purchased.

You can’t ever guarantee that a firm won’t go bust, but here are a few simple tips on how to shop so you’ve got more rights:

◆ Pay by credit card. You’ve got lots of statutory protection if you pay for goods or services using a credit card. There’s a nifty law called the Consumer Credit Act that says if you pay for things on a card that cost over £100 and less than £30,000 you could claim the money back from the card provider. You don’t even need to have spent the whole amount on the card as long as the deposit falls within the limits. This is known as making a claim under section 75.

◆ Failing that, pay by debit card. It’s not a legal right, but the card providers run a scheme called “chargeback”, which means you might be able to ask them to recall your money if there’s a problem. But act quickly. If a firm goes bust, it may be too late. Using electronic money services such as PayPal also gives you some rights, but read the dispute resolution rules first.

◆ Avoid paying by cash, cheque or direct transfer. You’ve got no rights to recall your money using these methods of payment. Always question businesses that ask for payments this way and don’t pay if you can’t afford to lose the money.

◆ Vouchers and gift cards. If a firm goes bust, then often vouchers you may have with them become invalid. They are generally treated as cash you are owed. Some firms that have gone into administration have honoured their vouchers. But if you hear rumours that a business is in trouble, don’t delay – use your vouchers and gift cards before it’s too late.

◆ Repairs and refunds. If you’ve bought something that doesn’t work but the retailer goes bust, you’ll need to go to the manufacturer to see if you can get a repair, replacement or refund. If you’ve not received your goods then ask for a chargeback from your card provider urgently.

If you’re worried you’ve been stitched up by a dodgy retailer, speak to your local Trading Standards officer – they’re based in the council offices. They can let you know if there’s a wider problem and investigate the business if they think there’s a cause for concern.

The best way you can protect yourself is to keep your eye on the news. If it sounds like a firm is in trouble, contact them asap. But act quickly – it’s the best way to safeguard your hard-earned cash.

Resolver can help you sort out complaints about pretty much anything – so why not help a friend or relative sort out a problem, get a refund or make a claim.

Check out www.resolver.co.uk and share your experiences at yourstories@resolvergroup.com