Know Your Rights!

Don't get ripped off! This financial safety net could save you when all else fails...

We Brits love our plastic. As a nation, we have more than 140 million credit, debit and store cards in our wallets - which all adds up to some serious spending.

But when it comes to splashing that cash on your plastic, how many of you would know your rights were something to go wrong?

Just this month, wedding list business WrapIt went into administration, leaving thousands of distraught brides, grooms and guests chasing unfulfilled orders, and wondering if they'd ever get the gifts they purchased -- or at the very least their money back.

Credit Card Perks

The good news is if you have a credit card and use it to pay for goods and services costing between £100 and £30,000, you will be covered under what's known as section 75 of the Consumer Credit Act.

This means that in the unfortunate event that your goods don't turn up, are damaged or the company is unable to fulfil your order because it goes bust, the card company is jointly liable for the purchase and you have a legal right to a refund.

What's more, the legislation also applies even if you only make a part-purchase with your credit card -- for example, by using it to pay a deposit on a sofa. In addition, you are protected for both purchases in the UK, and from 2006, purchases made overseas.

There are also some great additional benefits that some credit card issuers provide, which you can read more about in our guide: Why use a credit card?

Debit Card Defences

I have always been led to believe that Section 75 protection only applies to credit cards. However, if you're the owner of a Visa debit card, you have similar rights to your credit card counterparts under what's known as Visa's `Chargeback scheme'.

The name `Chargeback' simply refers to the process that returns the funds to your card issuer when you have successfully disputed a payment.

Like Section 75, if your goods don't arrive, are damaged, or the company goes bust, you may be entitled to a refund. However, the rules of Chargeback are a bit hazier, and each case is assessed on its individual merits.

In addition, you are entitled to dispute a payment up to several months after the date an order is `fulfilled'. However, the term itself is quite abstract, and can represent the latest of three dates:

• The date the card issuer processes the payment

•  The date of expected receipt of services

• The expected date of travel

Typically, the card-issuer then has up to six months from this `fulfilment date' to dispute and recover the payment on behalf of the cardholder.

However (and this is where is gets more complicated), guarantees and warranties purchased as part of the payment may also increase this six month period. For example, it is possible to fully or partially get your money back within 18 months of the `purchase date' on goods that have a 12 month guarantee (as stated on the web site). 

For this reason, there are two points you should bear in mind. 

Firstly, if you do make a big purchase, try to try to keep all payments and delivery documentation related to the goods/services.

Secondly, if something does go wrong, there's no harm contacting your card issuer to see if you are eligible to get a chargeback on your purchase. After all, what do you have to lose?

Unfortunately, if you are in possession of a Maestro or Solo debit card, you are not protected under this or any other scheme, so you should treat payments using these cards as you would do with cash, and think carefully before deciding which card to use when paying for your goods at the tills.

Plan Of Action

So, what happens if you do need to claim money back?

Well, in any case, you will first need to contact the merchant direct to see whether the dispute can be resolved before approaching a third party.

If your attempts to resolve the situation are unsuccessful, the next step is to approach your card issuer. You will probably need to put your complaint in writing, forwarding evidence of your purchase and/or communication between yourself and the retailer - so make sure you keep those receipts!

As for how long it could take you to get a refund, timescales vary depending on your bank/credit card provider, though they tend to take weeks as opposed to days.

I would advise people to use either a credit or Visa Debit card to pay for big purchases. With credit cards, as long as you pay you balance off in full each month, it will cost you nothing to have that extra peace of mind. Hopefully, by remembering your rights you can maximise your card benefits and make them work for you.

More: Credit Cards For Crafty Customers / The Five Worst Credit Card Rip-Offs.Ever!