How Hidden Card Service Can Save You Hundreds
Chargeback is a voluntary scheme where banks reverse card payments if there is a breach of contract; it is not a legal right. This service can be used when goods or services are defective, not as described, never delivered, or if the company goes bust. When a chargeback is initiated, the bank recovers funds from the retailer's bank, and the retailer has an opportunity to dispute the claim. If the claimant is unsuccessful, they can appeal to the financial ombudsman.
Cards covered by the chargeback scheme include Debit cards (Visa Debit, Visa Electron, Maestro, Mastercard), Prepaid cards (Visa, Mastercard), and Credit cards (Visa Credit, Mastercard, American Express). To claim a chargeback, customers should use their bank's website or submit an email, online form, or letter including details such as the retailer's name, purchase date, payment method, description, expected delivery dates, and any proof of the transaction or issue. The bank may request additional evidence.
There are time limits to make a request: generally 120 days to initiate a claim, with American Express allowing 20 days to dispute, and Visa/Mastercard allowing 45 days to dispute. For future purchases like flights, coverage starts from the date the service would be used. If only a deposit was paid by card and the remaining amount by another method, a chargeback refund may not be possible for the deposit.
Section 75 protection applies to credit card purchases over £100, entitling the customer to protection covering the full cost even if only a penny was deposited. Mastercard requires a minimum purchase of £10 for chargebacks, unlike Visa or American Express. Chargebacks are usually not available when paying via PayPal but may be possible if the PayPal account is empty and payment was made with a registered debit card, according to MoneySavingExpert.
Retailers generally dislike chargebacks due to the costs involved in resolving them. Claimants are advised to persist as initial attempts are often rejected.
