Visa, Mastercard & Amex Chargeback Protection for debit card purchases

There's valuable hidden protection on Visa, Mastercard and Amex credit cards and most debit and charge cards. It's called 'chargeback' and means if you don't receive the goods you bought, you may be able to get your money back.

This full Q&A guide shows you how to maximise protection, when you're not covered, and includes a free template letter for claiming.

While every effort's been made to ensure this article's accuracy, it doesn't constitute legal advice tailored to your individual circumstances. If you act on it, you acknowledge that you do so at your own risk. We can't assume responsibility and don't accept liability for any damage or loss which may arise as a result of your reliance upon it.

What is chargeback?

A 1970s law means your credit card company must take responsibility if things go wrong in a purchase — for example, if goods are faulty or the retailer goes bust. But it only covers purchases of over £100 made on a credit card. Read our full guide to these Section 75 refunds.

The idea is if you pay on the card, whether for a flight, kitchen, computer or anything else, then the card provider's responsible too. Yet even if Section 75 doesn't apply, there's a different scheme - known as chargeback - that you can fall back on if you used one of these cards.

It's important to know this is part of Visa, Mastercard and Amex's internal rules and NOT a legal requirement (which Section 75 is).

Key differences between chargeback and Section 75:

	Chargeback	Section 75
Do banks legally have a responsibility?
Does it apply to all consumer rights?	No, it's more for when goods don’t arrive or are faulty, rather than future issues
Is it free of time restrictions?	Within 120 days of problem, and within 540 days of purchase
How much can be claimed?	No limit (min £10 for Mastercard)	Between £100 and £30,000
Can you appeal to the Financial Ombudsman if unsuccessful?

Chargeback successes...

What chargeback can be used for?

Importantly, as it's asking for money back from the supplier's bank, not the supplier itself, the money should come back even if the retailer has gone bust — though this isn't guaranteed. If a transaction hasn't been completed properly, the onus is on your bank to get the money back and you should get a refund.

Some possible reasons for claiming a chargeback are:

• Company goes into administration — the company you purchased from has gone bust.
• Quality of item — the goods were not as described or were defective.
• Non-delivery — the goods were not received as promised.
• Technical issue — expired authorisation or a processing error by the bank.
• Clerical error — being charged multiple times or being billed for the incorrect amount.
• Fraud — you have been the victim of fraud and did not authorise the purchase.

How does chargeback work?

Complain to your bank/card provider within 120 days of the purchase, and ask to dispute the transaction. It can then start the procedure of claiming the money back from the supplier's bank. It's also good practice to contact the seller (and it may speed the process up).

Some claims can be made after 120 days - for example, if you joined a gym on a two year contract, and it went bust after a year, meaning you didn't get the service you paid for - but even with these claims, there's a limit of 540 days from the date of paying for the contract.

It's worth noting most bank staff don't really know about this procedure, so you may need to explain it to them. There's no upper limit to the payouts (Mastercard has a minimum of £10).

If you're told to put your request in writing here's a template letter to help:

If you're unsuccessful, then contact the Financial Ombudsman to make a complaint. This is completely free and well worth doing, there's a simple claim form on its website and details on how it can help in the Financial Fight Back guide.

Chargeback is nowhere near as strong as Section 75 for credit card purchases. The key difference is that when you complain under Section 75, the credit card company itself is legally liable. With chargeback it's just about the Visa/Mastercard/Amex process, and that's nowhere near as weighty. It's also the case that you can't take the issue to court if your bank won't pay.

Credit cards give GUARANTEED protection

While chargeback is a useful tool, Section 75 is much stronger as the credit card company is legally liable. So, to ensure you have the most protection, if you're spending over £100 it's worthwhile using a credit card. Read the full Section 75 guide for more details and exceptions to the rules.

Yet credit card companies do, of course, make their money by charging you interest. And frankly the interest cost is so large it often overrides the protection, so follow…

Always set up a direct debit to pay the card off in full each month, so you'll never pay interest.

If you don't have a credit card or have debts on a card, and need another especially for these purchases so you can pay it off in full each month, then it's time to apply for a new card. In which case the two best choices are:

• A cashback credit card. These pay you each and every time you spend on them. Set up a direct debit so there's no interest. This can add £100s a year to your income, without any hassle, so you get a double boon. Full info and best buys in the Cashback Credit Cards guide.

• A 0% for spending card. Borrowing in the current climate isn't a good idea. Though if you are going to spend on a card you can't repay in full, at least ensure it's as cheap as possible. A number of cards offer 0% interest for a year or more on all your spending, full info and best buys in the 0% Interest Cards guide.

If you have a poor credit score and can't get a credit card, read Section 75 without a credit card.