loophole in the law could be costly for credit card holders: shoppers warned they could be left out of pocket by little known exemption - leather credit card holder
Millions of shoppers who spend money on credit cards may take thousands of pounds out of their pockets because of legal loopholes.
Anyone who purchases using a credit card should be protected by Article 75 of the Consumer Credit Act.
This makes it the common responsibility of retailers and credit card companies to pay a refund when the product fails or is not delivered.
It is suitable for purchases between 100 and 30,000.
Many people shop on credit cards-
Like a holiday or a car --
It is because if something goes wrong, they will feel at ease.
But a joint UK good morning survey by financial experts and ITV found that as companies rely on little-known exemptions to get out of trouble, clearly valid claims were rejected.
In one case, a man paid a family member £ 6,000 for breast surgery with an American Express credit card to qualify for 75 protections.
After the patient was not satisfied with his work, he tried to seek a refund.
Amex rejected the claim on the grounds that the payments made to the surgeon were collected through a third-party company called iZettle.
Technically, to apply in section 75, there must be a direct connection between customers, suppliers and credit card companies.
If the involvement of an intermediary or a third party is deemed to have broken the relationship, the protection of Section 75 will not apply.
The exemption means that millions of people who believe they are protected may be pulled out of their pockets for hundreds or even thousands.
Dozens of professional payment processing companies such as Paypal and Worldpay provide retailers with the ability to accept online orders or provide card terminals to shopkeepers.
What is even more confusing is that the Financial Ombudsman handling 75 disputes is not able to provide clear guidance to the client when purchasing unprotected.
It said that a comprehensive investigation of each payment had to be conducted to determine how the payment was handled and whether Section 75 protection measures were applicable.
Martin Lewis, founder of wealth management experts
Com said: "If you buy anything over £ 100, I always recommend that you pay at least a portion with your credit card for very valuable 75 terms protection.
However, we now have a strange situation where if you pay on the company's website or get a machine in the store, some hidden fuzzy details will void your protection.
We need to clarify that, he added.
When Section 75 does not apply, the company and the payment processor should be clearly stated.
Not only are they not telling you at this moment, they don't even know themselves.
A spokesman for Ombusman Financial Services said: if someone has been rejected by their bank or credit card provider and is concerned that they have been treated unfairly, they can contact the Financial Ombudsman Services, we will independently check whether there is a problem with the complaint decision.