How safe are you paying with a credit card? The dangerous gap firms are exploiting to sidestep your rights

Credit card users mistakenly believe they have a rock solid guarantee they will be reimbursed if there’s a problem with the goods or services they buy or a firm goes bust.

Research from MoneySavingExpert shows that’s not always the case.

Under section 75 of the Consumer Credit Act 1974 when buying goods or services, worth between £100 and £30,000, on a credit card you could have extra protection.

The credit card firm is jointly and severally liable for any breach of contract or misrepresentation by the retailer.

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Consumer rights

But there’s a loophole – when a third party payment processing system is used – meaning the direct link between you and the firm you’re buying from is broken.

It’s complex, especially online when buying via firms such as Amazon and Paypal.

Buy direct from Amazon and you’ll be covered. Buy via Amazon from a third party seller, breaking the direct line between you and the seller, and in theory you’re not covered.

Martin Lewis, founder of, said: “If you’re buying anything costing over £100 I’ve always suggested you pay for at least some of it on a credit card to get the hugely valuable Section 75 protection.

“Yet we now have the bizzare situation that if yo pay on a company’s website, or get given a machine in a shop, some hidden nebulous details about the way it’s done can invalidate your protection.”

The scale of the problem

But, but… We were protected!

Whenever possible try and buy direct from firms as you will have better cover. And that’s what free consumer complaints service recommends.

Martyn James, from free consumer complaints service , said: “We receive hundreds of enquiries from people with section 75 problems and this is one area where the law could do with being a lot clearer.

”We recommend that people do their research for goods and services and then try and deal direct with suppliers.”

If you get a claim turned down by your credit card firm it’s worth taking your case to the Financial Ombudsman Service via or call 0300 1239 123.

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