Money Protection – Section 75 VS Chargeback

Nowadays especially, more and more people are buying online. In fact, it will probably come as no surprise that in 2020, roughly a quarter of the worlds population made a purchase online, with no doubt that lockdown has played a key role for this.

But when you buy online, you are buying blind; sight unseen. This can cause worry and confusion for many, and of course, they bigger the purchase – the higher the risk.

We have all heard horror stories of someone – usually a friend of a friend, who brought something online, only to have an empty box/ wrong item/ nothing at all delivered.

Whilst it is true that you have to be extra vigilant when ordering online (always check the description, measurements etc), there are other ways you can protect yourself. You, the consumer, have legal rights. Although these are not guaranteed to save you from every situation, you may find yourself on more even ground if you have some back up options to pull out from your sleeve (should you ever need to).

Section 75

As a standard rule of thumb, when purchasing bigger items, it is always a good idea to buy on credit card if possible, compared to debit card. Although you may end up paying interest on top (depending on your card deal), you are also covered by something called Section 75. Under Section 75 of the Consumer Credit Act 1974, the credit card company is jointly liable for any breach in contract, or any issues that may occur with your purchase. This immediately gives you another level of protection.

Although you cannot recover costs from both companies (that would just be cheeky!), it does mean that you don’t have to panic if your retailer refuses to acknowledge your claim, or ignores any attempts to get in touch; legally, your credit card company is just as responsible as the retailer to right any wrongs. This is particularly useful if the company you have ordered from goes under.

There are some eligibility restrictions when making a claim under Section 75; however it definitely gives you added protection that you would otherwise not have.

Chargeback

Didn’t pay by credit card? Don’t panic! You could still have a helping hand on your side, even if you only paid by debit card, with a small but powerful scheme known as Chargeback. Relatively unknown still, chargeback is not a legal stipulation. However, it does allow you to raise a dispute with your bank if your item(s) is either:

• Damaged
• Not as described
• Not delivered

To raise a chargeback claim with your bank, you will need to contact them, and ask to raise a chargeback claim. They will ask for full details of the transaction, as well as the reason why, and whether the claim was for a fraudulent or genuine transaction. Once they have submitted the claim, you will have one of three outcomes. Either you will get your money back immediately, be submitted for a review and the retailer will be questioned, or flat out refused.  These usually go on a probability scale, so make sure you have as much evidence to back up your claim as possible; the stronger your argument, the more likely you are to win.