How Section 75 Protects Consumers

Section 75 of the Consumer Credit Act 1974 is a foundational legal protection for consumers in England and Wales when they use a credit card to pay for goods or services. It gives cardholders a statutory right to claim against their credit provider if a purchase goes wrong, such as non‑delivery, defective goods, or a business failing to perform its contract. This article explains in plain language how Section 75 works, the circumstances in which it applies, how to make a claim, key legal criteria, exceptions and limits, and practical advice for consumers. It is written for anyone from members of the public to solicitors seeking a clear, accurate reference.

What Section 75 Is and Why It Matters

Section 75 is part of the Consumer Credit Act 1974, a statute designed to protect people who borrow money or use credit facilities. Under Section 75:

• The credit card provider becomes jointly and severally liable with the retailer or trader for any breach of contract or misrepresentation by the seller.
• This means you can make your claim for compensation or a refund directly against the credit card company rather than relying solely on the seller.
• It applies to a wide range of purchases funded by credit cards, including online, telephone, and in‑person transactions.

Joint and several liability means the card issuer and the merchant are equally responsible for the transaction. If the supplier disappears, goes into administration, or refuses to remedy a problem, your credit provider can be held to account for your loss.

How Section 75 Works in Practice

To qualify for protection under Section 75:

1. You must have made the payment using a credit card (not a debit card).
2. The goods or services must have a total price of more than £100 and not more than £30,000.
3. There must be a single contract, meaning the purchase price applies to one item or a linked set of items.
4. There must be a direct transactional link between you, the supplier, and the card provider.

Spending Thresholds Explained

• The lower limit of £100 refers to the price of the individual item or service, not the amount you paid on the credit card.
• The upper limit is £30,000; beyond this, Section 75 protection does not apply.
• Even if you paid only a deposit on your credit card, you may be covered for the entire purchase value provided the total transaction cost falls within the thresholds.

For example, if you book a holiday costing £1,500 and pay a £150 deposit on your credit card, with the remainder on another card or by cash, Section 75 can still protect the full £1,500.

What Section 75 Covers

Section 75 protects consumers in situations where:

• Goods are faulty or not as described when delivered.
• Goods fail to arrive after payment, including online and mail‑order purchases.
• Services are not provided as agreed, such as holidays or renovations.
• The seller goes out of business before fulfilling the contract.

Section 75 also applies to purchases made abroad or with overseas suppliers, provided the transaction meets the statutory criteria.

What Section 75 Does Not Cover

There are important exceptions and limits to Section 75 protection:

• It does not apply to debit cards, charge cards, or prepaid cards. A different scheme known as chargeback may be available in those cases.
• It does not apply if you use your credit card to withdraw cash or make money transfers.
• It may not apply where the payment is processed by a third party that breaks the direct legal link between you, the supplier, and your card provider. Examples include some online marketplaces or intermediary payment processors.
• Combined purchases made of separate items each costing less than £100 generally do not attract Section 75 protection even if the total bill exceeds £100.

Providers sometimes have specific terms regarding additional cardholders and certain financing arrangements, so it is advisable to check the terms of your card agreement when making significant transactions.

Step‑by‑Step: Making a Section 75 Claim

1. Attempt Resolution With the Seller

Before contacting your credit card provider, start by asking the retailer to resolve the problem:

• Request a refund or replacement in writing.
• Keep a record of all correspondence.

Although you can initiate a Section 75 claim simultaneously, attempting resolution directly may provide a quicker outcome.

2. Contact Your Credit Card Provider

If the seller will not cooperate:

1. Notify your credit card issuer that you want to make a Section 75 claim.
2. Provide full details of the dispute:
   • Copies of receipts and order confirmations.
   • Copies of correspondence with the seller.
   • Clear explanation of the issue (non‑delivery, fault, etc.).
3. Complete any claim forms your provider requires.

3. Wait for Investigation and Decision

Your provider will investigate and decide whether your claim meets the statutory criteria. They must consider your evidence and respond within a reasonable period.

4. Escalation if Necessary

If your claim is rejected and you disagree with the decision:

• Follow the provider's formal complaint procedure.
• If unresolved after eight weeks or after a “final response”, you can take your complaint to the Financial Ombudsman Service (FOS) for independent review.

Time Limits and Important Considerations

Under UK law, you generally have:

• Up to six years from the date of the breach to make a Section 75 claim for most consumer purchases.
• If the transaction involved services or undelivered goods, time might run from when the service should have been performed.

Keep records of all transactions and correspondence, as evidence is critical in making a claim successfully.

Common Questions About Section 75

Does Section 75 Apply to PayPal Purchases?

Section 75 may apply to payments routed through PayPal if the credit card provider considers there was a direct payment to the seller and not solely to the intermediary. This can depend on the specific arrangements between PayPal and the merchant.

What if I Paid With Store Credit or Finance?

Certain store finance arrangements and store cards can attract Section 75 protection, provided they meet statutory credit agreement criteria and the purchase value falls within the £100–£30,000 range.

Are Additional Cardholders Covered?

Additional cardholders may be covered in some cases, but this is often at the discretion of the credit card provider and based on how the account is structured.

Key Takeaways

Section 75 of the Consumer Credit Act provides powerful legal protection for consumers in England and Wales who use credit cards. If you pay for goods or services costing more than £100 and not more than £30,000 with your credit card, you can hold your credit provider jointly liable with the seller if something goes wrong. The law applies even if you only make a deposit on your card, and it can cover faulty goods, non‑delivery, and business failures. While there are exceptions and limits, understanding how to make a claim and when it applies can significantly strengthen your consumer rights and help you recover losses.

James William Steven Parker

James is the founder of UKLegalGuides.com and a former agent at the Ministry of Justice (UK). With a background in processing legal claims, he launched this platform to make the laws of England and Wales accessible to everyone.