Where you buy goods that are over the value of £100 on a credit card, it provides you with extra protection if something were to go wrong with your purchase (eg non-delivery, mis-described etc). It means that you will not only have a claim against the business, but you can also claim against the credit card company (eg if the business is refusing to put things right or have gone out of business). In fact, this applies even if you simply pay the deposit on a credit card so long as the total value of the item is over £100.
Some important things to remember:
The £100 applies per item, so if you buy 2 tickets, they must each be worth over £100 for you to get the protection.
The protection applies even if you pay off the balance on your credit card immediately after buying the item.
The protection is more limited if you use your partner’s card (i.e. you are not the main account holder), even if you are named on the account – see the Financial Ombudsman’s decision below under “How to Complain”.
You can claim against both the retailer and the credit card company at the same time (i.e. you don’t have to wait until you’ve made an unsuccessful claim against the retailer first) but you are not entitled to be compensated by both.
The protection applies if you purchased the goods abroad BUT NOT if you used credit card cheques or if you bought the goods with cash withdrawn using a credit card.
How to complain
Write to the credit card company, mentioning Section 75 of the Consumer Credit Act 1974. If you reach a “deadlock” situation with them then you should complain to the Financial Ombudsman within 6 months of the final correspondence. The Ombudsman has given some important decisions and you should read these if you are thinking about making a complaint to them:
Using a debit card or Paypal
Section 75 does not extend to purchases made by debit card or via
online payment systems such as PayPal.
However, you may still be able to benefit from the Chargeback scheme.
Finally, if you think someone is fraudulently making withdrawals on your debit or credit card then please read decisions from the Financial Ombudsman.