If a company (eg: tour operator) goes bust, can you get any money back on a debit card?

[mcgillianaire]

From here:

"Yes. If you booked by credit card or Visa debit card you can make a claim via your card company [...] Anyone who made their purchase with a Visa debit card is covered by its Chargeback scheme, which offers similar protection to section 75. To make a claim customers must contact their card issuer, which then contacts the company's payment-processing bank to reclaim the money. This means that even if a company goes into liquidation it is possible to reclaim money, as the claim is made against a bank not the company. Sometimes card issuers misunderstand the section 75 and Chargeback rules and refuse a claim. Anyone in this situation should make sure they know their rights and argue their case. If all else fails contact the Financial Ombudsman."

This entry was inspired by loganberrybunny who posted about the seemingly unfair situation in which "if you spend money you haven't got, you're protected. If you spend money you have got, you're not". Hopefully this will clear things up. And do spread the message!

Comments

[kali-kali.livejournal.com]

It is unfair, but it shows who the credit card companies are looking out for: themselves. If you lose your money, only you are out that amount. If the credit card company loses it, both you and they are out the cash.

[mcgillianaire.livejournal.com]

True. But interestingly under the section 75 protection:

"...you don’t have to have paid the full amount on your credit card – the card company is liable even if you made only part of the payment (a deposit, say) on your card. And this part-payment can be as little as £1. It is the value of the goods you are buying that is key, not the amount paid on the card. For example, if you bought a car from a small local dealer and paid a £500 deposit with your credit card and the balance of £4,000 by cheque, you would be covered for the whole £4,500 under section 75 if the dealer went bust before you received the car."