Did you know that if you’re buying something costing between £100 and £30,000, you could have more protection if you put it on a credit card rather than paying for it another way?
Thanks to a handy piece of legislation called Section 75 of the Consumer Credit Act, individual credit card purchases that meet certain criteria have extra protection, so you have a good chance of getting your money back if the item or service doesn’t materialise or isn’t all it was promised. If you’ve made a purchase on a debit card, then these protections don’t apply, although other safeguards might. Have a look at our article How to get a refund from your credit or debit card using ‘chargeback’.
Here we explain how Section 75 works, what your rights are, and how you can make a claim.
What is Section 75?
Section 75 essentially means that if something goes wrong with something you’ve purchased using a credit card, such as the item not arriving or being faulty, then the retailer and your credit card company have the same responsibility towards you. So if the retailer won’t give you your money back, your credit card company might, basically giving you an extra layer of protection.
The whole point of Section 75 is to make sure that you never have to repay a debt on something you didn’t receive or wasn’t up to scratch.
How does Section 75 work?
Section 75 places joint legal responsibility on your credit card company AND the retailer you bought something from to refund you if you’ve paid for an item or service and something goes wrong. This doesn’t mean that you’ll get two refunds, but rather that both parties are legally responsible for ensuring you’re not left out of pocket.
To be able to make a claim, the item or service you’ve bought using your card must have cost between £100 and £30,000 and meet one of more of the following criteria:
- The item or service was misrepresented – if you’ve bought something and it turns out not to be as described, you might be able to get your money back. For example, if you bought a coffee machine because it has a cup warmer and it turns out that it doesn’t have this feature, you could make a claim.
- There was a problem with the item or service – if the items or services you ordered never arrived, they’re faulty or aren’t in the condition expected you might be able to make a claim.
- You’ve lost other money as a consequence of the initial issue – Section 75 also covers something called “consequential losses” which basically means that if you’ve lost money as a result of the issue with the product or service, you can make a claim against this as well. For example, if you bought tickets to a show that was cancelled, you might also be able to make a claim for your travel and accommodation costs too.
- You bought something with a store card – these purchases are included under Section 75, so if you’ve made a purchase of the right value and something goes wrong, you can make a claim.
- You bought something from a retailer or company that has gone bust – if you paid for goods or services and never received them because the company went bust, you can make a claim.
One important point to note is that you don’t actually need to have paid for the item or service outright on your credit card to make a claim. Even if you’ve put down a £1 deposit on an item or service that ends up costing between £100 and £30,000 you can still make a claim. These rules apply to any purchases you’ve made with your credit card, whether that’s in the UK or overseas, in person or online.
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When can’t you make a Section 75 claim?
There are a number of occasions when you might not be covered by Section 75, including if:
- The item or service cost exactly £100 or less – Section 75 only covers purchases that cost over £100, so if the item or service you’ve bought is £100 on the nose, you won’t be covered.
- You bought multiple items that add up to more than £100 – The item or service will need to cost over £100 on its own for you to be able to claim.
- Your credit card company is also the retailer – although unlikely, if the product or service you bought were from your credit card company, you won’t be covered.
- You bought something from a third-party seller – If you bought something from somewhere like eBay or Amazon Marketplace, you might not be covered by Section 75.
- The item is still under warranty with the retailer – if you bought a big ticket item that’s still under warranty, you won’t be able to claim under Section 75 as you already have protection in place.
- The purchase was made by a secondary card holder – this is a bit of a grey area, but usually, if the purchase was made by a secondary card holder and the item or service wasn’t for the benefit of the main card holder, you won’t be able to make a claim. For example, if the secondary card holder bought a designer jacket for themselves, you wouldn’t be covered, but if they bought it for the main card holder, they might be.
You also can’t make a claim if you’ve simply changed your mind about your purchase, or if you don’t meet the eligibility criteria we outline above.
How do I make a Section 75 claim?
There are various steps you should follow if you need to make a section 75 claim.
Complain to the retailer first
While Section 75 is designed to protect your money, it can be a lengthy process, so it shouldn’t be your first route to getting your money back. In many cases, you might find that the retailer is willing to give you a refund, so you should always file a complaint with them first.
Section 75 outlines that both the retailer and your credit card company are jointly liable for anything that’s gone wrong, so approaching the retailer directly could provide a quicker route to getting your money back.
If the retailer won’t give you a refund, or you weren’t able to complain, for example, if the business has gone bust since your purchase, then you will want to start your claim with your credit card provider.
Making a claim with your credit card company
Every credit card company has a different process for how they want you to make a Section 75 claim, so it’s always good to check how to do this with them directly. As a general rule, to make a claim you’ll need to provide your credit card company with:
- The name of the retailer
- The item or service you bought from them
- The cost of the item or service – this it the total value of the item or service, rather than the amount you paid on your credit card
- Proof of purchase including the date you made the purchase
- Any subsequent costs you’ve incurred because of the faulty product or service
- Reason for your claim – for example, what’s wrong with the item or service, or has the company gone bust?
- Proof of your attempts to get your money back from the retailer
Once you’ve made your claim, your credit card company will look into the issue and might ask you for more information to support your claim. They’ll then either accept or reject your claim.
If they reject your claim, and you disagree with the outcome, you can take this up with the Financial Ombudsman. They will act as an impartial party and will look into your claim to see if anything was done incorrectly, or if things weren’t dealt with fairly. If the Ombudsman agrees with your claim, they can order your credit card company to pay you your money.