What is credit card purchase protection?

When you use your credit card to buy something, from a holiday to a new coat, you could be protected under Section 75 of the Consumer Credit Act 1974. As long as it’s more than £100 and less than £30,000, you can have an added layer of armour if something goes wrong. This includes if the company goes bust and you need to make a claim. 

Here we look at how credit card protection works and how you can make a claim via Section 75 if you need to.

If you buy something like an item or a service with a credit card, you could be protected under Section 75 if something goes wrong.

This covers a wide range of things and means you can claim back any money you’ve spent if something happens and the retailer is not able to put it right, especially if the item is broken or the service wasn’t carried out.

It’s also worth noting that if you’re spending with your credit card but through a third party, such as Paypal, you will usually need to claim through them rather than your credit card provider.

Credit card users are covered under Section 75 of the Consumer Credit Act when you buy anything worth more than £100 but less than £30,000. You’re also covered even if you don’t pay the full amount on your credit card. 

If you have paid a deposit on your credit card under £100, but the total value of the goods is more than £100 and less than £30,000, your purchase is still protected. For example, if you paid a £50 deposit for a sofa worth £500 and paid the rest in cash, you are entitled to claim.

Contact with the merchant and evidence of the attempt to resolve is required for all claims. You will want to ensure you have tried to claim by chargeback before you claim Section 75, which is the process of asking your card provider to refund a payment when a purchase has gone wrong. Section 75 should be a last resort, such as in the situation where the retailer fails to reimburse after contacting them.

The protection available through the act provides cover if a contract has been breached or if an item or service has been misrepresented. This includes different types of scenarios, such as if you buy something which never arrives, or if the item was falsely advertised.   

However, this will depend on your situation. There are usually other protections, such as travel insurance or package holiday protections, which may cover the cost of any money lost. If a flight or holiday has been cancelled or rescheduled, your airline or holiday provider should be the one to contact to arrange new dates or rearrange where you go. You may also be able to claim using chargeback.

If you’ve experienced a problem with something you’ve bought with your credit card, you should try to contact the retailer first. 

Tell them what happened and what you would like them to do to put things right. In most cases, the retailer should be able to resolve the issue by offering a refund. If they don’t or if they're impossible to contact – they're overseas or have gone into administration, for example – you can contact your credit card provider to start a claim. You can usually do this online, via a banking app, or by calling their customer service.  

They’ll ask you to supply evidence to support the claim including receipts, booking and any communication between you and the company. You will also need to supply details about any efforts you’ve made to try and get the money back yourself, although this isn’t always possible – such as if a company has gone bust.

Section 75 is a handy way to protect yourself if you think you’re losing out financially. However, it’s not the only protection you have. Most retailers have rules in place to refund a customer if things go wrong. These usually have a time limit, and the details will be listed on the receipt when you buy something.

The Consumer Rights Act also covers anything you buy and states that any items you purchase need to be satisfactory, fit for purpose and as it has been described. If these don’t apply, you have rights and you can complain and ask for your money back.

You are also protected if you are a victim of credit card fraud and someone makes an unauthorised transaction with your card. You may also be able to claim via a chargeback by contacting your credit card provider.

Content correct at time of writing 30/01/24.

John Lewis Money is not responsible for content contained on external websites. This article is for promotional or information purposes only. You must not rely on it as advice. Please contact a financial adviser if you need advice before you buy a financial product or service.