Paypal and your credit card

Don't use PayPal to pay on a credit card

Retailers increasingly encourage customers to pay via PayPal. But do this on a credit card, and it scuppers valuable extra protection for items over £100.

Section 75 of the Consumer Credit Act 1974 says if you pay for something costing between £100 and £30,000, specifically on a credit card, the card company is jointly liable with the retailer.

In other words, if what you've bought is faulty, broken or doesn’t arrive, the credit card firm is obliged to put you right.

However, Section 75 only applies where there is a ‘direct relationship’ between a debt and the product. In simple terms, with Paypal, you pay it and it pays the retailer, so you don’t have Section 75 protection.

We’re hearing more reports of people falling foul of this, such as Sharon Fisher, who tweeted us:"Is it true Section 75 on credit cards doesn't cover you for PayPal/Amazon 3rd party purchases? Tried to claim." For full info, read the PayPal Warningguide.

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