Credit cards can get a bad reputation, but that is because it has been earned by people who haven’t used them in the right way.
For example, they run up debts and can only afford the minimum repayments on an expensive APR, or even worse they can’t afford the minimum repayments, at all.
But, especially if you use your plastic in the right way, you could be thanking your lucky stars for your credit card.
The credit card provider is equally liable alongside the retailer, if the item is damaged, faulty, not as described or never turns up at all (because the company you bought it from went bust).
If it’s lost or stolen within transit between the merchant and you, you can claim on chargeback instead, which applies to debit as well as credit cards.
So, in this video I will explain about the protection you get when paying for something with your credit card, no matter what provider it’s from.
The protection is known as section 75 of the consumer credit act and the consumer credit directive, both of these are your friends.
The consumer credit act will protect you on purchases made between one hundred pounds and Thirty thousand pounds. The consumer credit directive will top up this protection, to a total of sixty thousand, two hundred and sixty pounds.
So, if any of the goods or services that you have bought cost between these amounts are lost, stolen, damaged or they never turn up because the company went bust, you will be protected for the entire cost of that purchase, alongside the merchant.
Even better news
This protection still applies, even if you just put the deposit on your credit card and it’s not even the deposit that needs to be above a hundred pounds that can be for any amount at all, as long as the total cost of what you are buying is above a hundred pounds.
For example, if you used your credit card to pay for a ten pound reservation fee on a ticket price of one hundred and twenty pounds and that show never went ahead. You would be covered for the full cost of the ticket.
So if you’re thinking about making a large purchase any time soon, it is a good idea to think about putting it on your credit card, but of course make sure you can pay off the balance.
If you can’t do that immediately, it is worth looking at some 0% purchase credit cards, some of which are for up to twenty months interest free.