Nine in ten of us have a credit card. They’re convenient, universally accepted and come with major consumer protection rights. But what happens when credit card providers get your rights wrong?
We recently investigated the way credit card providers handle card disputes. Under section 75 of the Consumer Credit Act 1974, credit card companies are jointly liable for any breach of contract or misrepresentation by a company you buy goods or services from.
Examples could include items you ordered but didn’t receive, or items that you did receive but weren’t what you expected. In these examples, you’d be entitled to a full refund if you paid for the goods on a credit card.
The situation with section 75
To carry out this investigation, we asked volunteers to approach a range of credit card companies with a scenario that would be covered by section 75. This is hardly a fledgling legislation, but we wanted to see whether card providers would offer full redress.
As long as you’ve bought something that’s worth more than £100 (but less than £30,000), you’ll be entitled to full redress. That’s even if you’ve only paid as little as £1 on your credit card. However, only 34% of our volunteers were told they could get full redress from the credit card provider they’d contacted.
Section 75 isn’t rocket science. And yet we were given all kinds of unhelpful advice, like being advised to call Trading Standards or even the police, who I’m sure would love to tackle cases of people being sent the wrong coloured sofas.
The average APR for a credit card is currently 18.2% – providing credit card providers with a healthy profit. As such, it’s reasonable for cardholders to expect their providers to step in and cover their losses caused by non-delivery, items or services delivered but not as described, and losses incurred through fraud.
Your credit card rights
I think it’s outrageous that so many credit card providers were unable to give clear and accurate advice on their responsibilities to those people who approached them. It’s bad enough to get stung by a rogue or incompetent trader, but to get incorrect advice when making a credit card claim is unacceptable. It’s only made worse when they try to send you back to the retailer to deal with the problem.
Isn’t it about time for the industry to give credit where credit’s due? Have you ever experienced problems when making a credit card claim?