Credit Card-Loophole

Published by Shahdaroba Sunday 13th May 2012

Have you used your credit card to purchase an item? Well, here is something you may, or may not know.

Most all of us are aware that if you pay by credit card if the purchase is/over £100 and not more than 30,000 pounds you can claim your money back from the card company. on grounds, the seller fails to honor the contract or the item is faulty, or if the seller wrongly describes it, or if the supplier goes out of business.

Be aware this protection may only apply to cards such as Visa or Mastercard, and those such as American Express are charge cards, where the balance has to be paid in full each month, debit cards, or credit card cheques. would not have this level of protection.

Visual Reference

Are you aware your guarantee could still be worthless? Below is when this may apply…

If you purchase an item on your card from a store, shop, www, etc. you should make sure you are buying it directly from that particular company. If the item you buy is through a third party then your card guarantee could be worthless.

An example of this would be… Let us say you buy something from PURCHASE ME NOW and the item you buy is from one of the companies that sell through Purchase Me Now. This then may make your card guarantee worthless.

Why I hear you say? Well, your card guarantee only covers you when buying directly equal liability. from the named company concerned in the transaction. In my example above you have purchased something, from a third party, ie. you pay your money to PURCHASE ME NOW who then pay the company you bought from. In these cases the credit card company would usually say it didn’t have a direct relationship with the supplier, so isn’t equally liable.

It’s the third party bit that stops you from claiming a refund from your card under section 75 of the Consumer Credit Act 1974, protect your purchases. You could call it a loophole in the small print and a change in the law should be called for but is probably or highly unlikely to happen. Trying to make a claim in the courts is possible but unlikely to succeed.

I hasten to add PURCHASE ME NOW is fictional and does not exist. I use them here only as an example.

Image by nneem from Pixabay

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