What is Section 75 of the Consumer Credit Act 1974? How can I start a Section 75 claim? Am I covered under Section 75 Claim for my purchase?
If you have used a credit card for a purchase then your transaction could be protected under Section 75 of Consumer Credit Act of 1974 which is like an extra layer of protection for your transactions if eligible.This is different from the Chargeback and Insurance benefits that you get with your credit cards.
What is covered under Section 75?
If you have used a credit card for a purchase, then your transaction could be protected under Section 75 of Consumer Credit Act of 1974, which is like an extra layer of protection for your transactions if you are eligible.
This is different from the Chargeback and Insurance benefits that you get with your credit cards.
What is covered under Section 75?
- Purchases made on your UK Credit Card are covered.
- Transaction amount should be between £100 and £30,000.
- If your transaction is eligible for Section 75 claim, it may cover full or partial original transaction and any other losses you have over and above the original transaction. (However, it will depend upon the Terms and Conditions of your purchase).
- Any deposit that has been paid via Credit Card is covered, even if the full amount has not been paid via Credit card. For example, – You have a total purchase amount of £500, and deposit of £40 has been paid using credit card, and remaining amount has been paid by other means (like cash, debit card/charge card) will be covered.
- If you have paid a part of your purchase through your credit card where the total purchase amount is above £100.
What is not covered in Section 75? Section 75 does not cover everything, following are the few situations where you “may” not be covered.
- Transactions less than £100 or more than £30,000 .
- Transactions on Debit card, Charge card or paid via cash.
- Transactions done using third party or payment aggregators like Paypal, Amazon MarketPlace, third party travel agent, Expedia etc, however, these organizations may provide you with their own payment protection plans which you can check with them by contacting them directly.
- Transactions done on your credit card for someone else and purchase agreement is not with the cardholder.
- If goods or services purchased on a credit arrangement but does not involve a credit card such as money transfers, unregulated credit provided by retailers at point of sale, cash withdrawals will not be covered usually.
- If goods and services are purchased using a Gift card will not be covered even if the payment for Gift card has been done using credit card, however, there is an exception case where you are unable to use the gift card due to business is no longer trading (has gone into liquidation) and gift card has been purchased using credit card with amount of £100+ can be covered under Section 75.
- Purchase limit of minimum £100 applies to each item or set of item and not on total bill, for example if you have bought a Jacket and a dress that weren’t part of a suit and each cost less than £100 will not be covered.
- Cash withdrawals from credit cards are not covered.
When to file a Section 75 Claim?
Please check below situations where you can raise a transaction for Section 75 Claim.
- You have received a faulty item or service.
- Merchant with whom you have made a purchase breaches their contract with you.
- Product or service delivered but not as promised or advertised (Misrepresentation).
- If a company has gone out of business and ceased trading resulting in service or item not delivered or can’t deliver anymore.
If you are in any of the above mentioned situations the first step should be contacting the merchant (Service Provider) if they fail to respond or resolve the issue, You can get in touch with your Card Provider to know if there is a scope for Chargeback. If chargeback is not an option anymore you should ask them to raise under Section 75.
Is there a time limit to file a Section 75 Claim?
Yes,you can file a claim within 6 years of purchasing goods and services.
In non-receipt cases you can file when you were due to receive the goods or services.
How to File Section75 claim?
If you have a service or goods undelivered that can be claimed under Section 75 you can start your claim with your card provider, Please note that you need to contact your card provider, such as Barclays Bank , Santandar, etc (Please do not contact Visa, Amex or Mastercard).
You can let them know “I want to start a claim under Section 75 of Consumer Credit Act.”
Your card provider will start the claim process for you if the transaction meets the criteria.
You will need to share the Transaction amount, transaction date, Merchant name with your provider.
You will then let them know about the reason for the claim process, later you may need to provide the supporting documentation to support your claim and that’s all.
Your card provider will forward your claim to start the process and keep you updated with case updates.
What supporting documents do I need to start a section 75 claim?
- Proof of purchase (receipts, invoice or any doc which shows your purchase).
- Copy of Contract/ agreement/terms and conditions whichever apply.
- Marketing materials like website/app screenshots of information about goods or services purchased.
- Any communication from merchants related to your issue.
- Photos/videos of Goods indicating they weren’t as expected.
- Independent value assessment reports wherever needed.
- Payment proofs/receipt if needed(when you have paid a partial amount with other means (like debit cards or cash).
What if I have paid using Paypal or another third party payment aggregator?
If you have used any third party payment aggregators like Paypal, Amazon Marketplace, Expedia, etc. Basically, where payment is taken by a party who is not actually providing you service directly, these transactions are not covered under Section 75.
Transaction should be done with direct agreement with the merchant who provides the service to be covered under Section 75.
In these cases organizations like Paypal, etc have their own payment security systems in place. You can directly get in touch with them and know how you can raise a transaction for a claim if needed.
What if I have not used my credit card?
In case you have paid using debit card or cash these transactions are not covered under Section 75 of Consumer Credit Act, however you can contact your bank about the issue and they can check your options if the transaction can be investigated to resolve the issue.
I have paid for my friend. Am I covered under Section 75?
If you have used your Credit Card to pay for someone else then this transaction will not be covered under Section 75 because cardholders needs to be in direct agreement with merchant (Goods or service provider )
For example- You have booked tickets for a friend and if you would like to raise it under section 75, name on tickets will not match with the cardholder.
If you have paid for tickets in a group, let’s say you have used your credit card and your friends have used debit cards to pay for the same goods or service. In that case the amount paid through your credit card can only be raised under section 75.
What if the transaction is done by a supplementary cardholder?
If a transaction has been done by supplementary cardholders, it will then depend upon the nature of transaction.
First of all any claim must be made by Primary Cardholders as they are the one who is in agreement with the card provider.
Card providers may reject the claim if purchase is not joint.
For example- a family holiday/tickets were booked, Goods or services purchased under name of primary cardholder/ for primary cardholder.
My transaction is not covered under Section 75. What are my options?
If the transaction is done using a debit card or a third party payment aggregator in this case you can check for “ Chargeback”.
Chargeback is not a legal protection like Section 75. It is an agreement signed by Visa, Mastercard and Amex.
You can get a refund under a chargeback if the merchant has breached contract terms, delivered incorrect or faulty goods or service, or you have not received goods or service.
In this case of chargeback your bank may contact the merchant on your behalf raising the issue and if the merchant is unable to provide a valid documentation supporting their claim you may get a refund under chargeback.
You are required to raise a transaction for chargeback asap you know about the issue, transactions can be raised within 120 days of the transaction date or expected delivery date in case goods or services were supposed to deliver on a later date.
You will need to inform your bank or card provider about the issue, transaction amount, date, merchant name and supporting documents to start an investigation under Chargeback.
In case Chargeback is not an option for you and transaction is done using a credit card you may check for Insurance cover that comes with your credit card to know if it can be claimed under card Insurance.
I have only paid a part of my total transaction with a credit card. Am I covered under Section 75?
Yes, if the transaction amount is between £100 and £30,000 and you have only paid partially using your credit card and the rest of the amount has been paid on Debit card, Charge Card or Cash it is covered all you need is inform your card provider and share the payment proof for remaining transaction that’s all.
Information Sources-
- https://www.ukfinance.org.uk/our-expertise/cards/chargeback-and-section-75
- https://www.moneyhelper.org.uk/en/everyday-money/credit/how-youre-protected-when-you-pay-by-card#:~:text=How%20to%20complain-,Section%2075%3A%20credit%20card%20payment%20protection,of%20the%20Consumer%20Credit%20Act.
- https://www.financial-ombudsman.org.uk/consumers/complaints-can-help/credit-borrowing-money/goods-services-bought-credit#:~:text=If%20you%20used%20a%20credit,supplier%20of%20goods%20or%20services.
