Section 75 of the Consumer Credit Act 1974 protects you when you use a credit card to pay for goods or services that cost between £100 and £30,000. This means your credit card company is equally responsible with the seller if something goes wrong.
For example, imagine you buy a new car worth £25,000 using your credit card. If there are issues like the car breaking down or the dealer going bust before completing delivery, Section 75 covers you. You can claim against both the seller and your credit card company to get your money back or fix any problems.
This is crucial for consumers because it provides an extra layer of protection when using a credit card. Instead of relying solely on warranties or small claims court, which can be time-consuming and costly, Section 75 gives you another avenue to seek resolution quickly and effectively.
this legislation applies only if the purchase is made directly with your credit card; it doesn't cover cash advances or purchases made through a third party. The protection also does not apply to business transactions or personal loans.
A practical tip: Always check if you can pay for major car repairs or new vehicle purchases with your credit card, especially when dealing with larger sums of money over £100. This ensures you have the added security and peace of mind that Section 75 offers.
How This Relates to the FCA Redress Scheme
The FCA motor finance redress scheme covers 12.1 million agreements with an average compensation of £829 per agreement. The total cost to firms is £9.1 billion. If you had PCP or HP finance between 6 April 2007 and 1 November 2024, you may be eligible. The final deadline to complain is 31 August 2027. You do not need a claims management company.