Buying faulty appliances with credit cards – protection

If we buy any appliance using a credit card we have extra protection which we aren’t always reminded about. Under Section 75 of the Consumer Credit Act, credit card companies are jointly responsible as long as the total amount is over £100. This means if you order something and it either doesn’t arrive or is delivered faulty you can claim a refund through the credit card company. They don’t usually like it, but if you are having any problems with the retailer you might be better claiming from the credit card company.

As I said, they don’t like it, and many are slightly awkward about facilitating it for us, presumably because they think it’s unfair? I have to admit it does seem unfair because even if you only paid a deposit with the card, which wasn’t even up to the £100 minimum and the rest was paid by cheque then apparently credit card companies still have to give you the full amount. This sounds completely bonkers but here are details of a recent Which? investigation that demonstrates this.

More protection than even logic might imply

The scenario presented to the credit card companies was that someone had bought an item for £400 and paid a deposit of £80 by credit card. The rest had been paid by cheque. But after cashing the cheque, the retailer went bust and the product was never delivered. Now would you expect that the credit card company should pay you the full £400 when you only paid £80 deposit with the card? Especially as the minimum set by Section 75 is £100? I can’t see any logical reason why they should, but according to Which? they are liable.

Which? found that when they checked up with the main UK credit card companies most of them gave the wrong information and in 33 out of 50 telephone calls were advised that the credit card company was not responsible for the total outlay – only the £80 they handled. Which? pointed out that they are, and when challenged the companies accepted this.

So there it is. If you buy anything over £100 (up to £30,000) using a credit card – even if you only partially paid on a card, and something goes badly wrong – or even if it’s faulty when it arrives – then you should be able to get a full refund from the credit card company. It’s probably better in most cases to deal with the retailer, but if they are being awkward and refusing to refund, or have gone bust, it’s nice to know there is the extra protection from Section 75 of the Consumer Credit Act. If you are a Which? member you can get direct telephone help and advice (see here for details – Why subscribe to Which?)