Credit Card Refunds Reviewed
Credit card companies are governed under the Consumer Credit Act and according to Section 75, all purchases between £100 and £30,000 are fully insured and covered by the credit card firms.
However there has always been a bit of a grey area about how protected consumers were when using their cards abroad. Yesterday, the House of Lords announced that the card companies ARE liable for any services or products that are purchased from overseas and would be insured if they arrive damaged or go missing in the post and do not get delivered to the consumer.
The court case was a challenge by Tesco Finance and Lloyds TSB against the existing CCA rules, but the exact extent to which credit card companies are liable is now clarified.Great news for us consumers who have a valid claim for undelivered goods and services. The Banks showed their disappointment but realised this decision was inevitable, because the section 75 of the CCA did nothing to claim that foreign transactions were to be excluded from this insurance cover.
The worry banks have with being liable for such cover, is not the small items that may go missing and have to be refunded, but for things such as a consumer renting a car using his credit card and crashing it in a country such as America. This decision could mean banks are liable for any legal costs involved. The moral of the story? Drive carefully.
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