Paypal

martmarsh

My credit card company claim that payments made via Paypal are not covered by section 75 of the Consumer Credit Act because there is no direct buyer-credit-seller relationship. In other words if, the selller processes the CC trx it is covered but if you use a mechanism like Paypal, it is not. I find this hard to believe but will avoid using Paypal for any major purchases in future. Anyone have any thoughts ?

meer53

Your CC company is correct.

halibut2209

They are correct. You are paying paypal for a service. As long as they provide that service then you are not convered under S75

bazster

martmarsh wrote: »

My credit card company claim that payments made via Paypal are not covered by section 75 of the Consumer Credit Act because there is no direct buyer-credit-seller relationship. In other words if, the selller processes the CC trx it is covered but if you use a mechanism like Paypal, it is not. I find this hard to believe but will avoid using Paypal for any major purchases in future. Anyone have any thoughts ?

PayPal has its own scheme for refunding you in case of fraud, item not delivered etc., and unlike s75 it covers all purchases, not just those of at least £100.

Maybe not as reassuring as having the law on your side, but still good to have, and arguably better than a credit card for purchases < £100.

CoolHotCold

Paypal almost always errs on the side of the consumer when disputes appear. Though you only have 45 days to raise one I believe.

Though Which has a different statement http://www.which.co.uk/consumer-rights/sale-of-goods/your-rights-when-paying-by-credit-card/cca-section-75-problems/ to say they are.

Though the MoneySavingExpert link says differently.


All the Financial Ombudsmen queries and judgements were made before 2010 before the Commercial Entity Agreement came into force from Paypals side (All businesses must accept these T&C to take payments from Mastercard and Visa from 2010 onwards).


So the question does a section 75 claim exist against a business who uses Paypal is actually quite open. Prehaps the CEA bypasses Paypal and funds are directly deposited into the business account and so a direct link is made with Paypal acting as the processing merchant?


Not for me to look it up or smart enough in fine details law...

It is however something Martin and the MSE team should revisit as both Which and MSE are consumer sites and say two different things. With Which saying section 75 covers business sellers on Paypal, and MSE saying Paypal is exempt from Section 75.





TL:DR Prehaps they are covered.

martmarsh

Thanks for the responses.I think coolhotcold got it about right. Having done more research I reckon "Which" are probably right and MSE wrong.Credit suppliers have to become associates/affiliates/members to be able to send funds and merchants have to sign a Commercial Entity Agreement. This CEA establishes a legally binding contract with the credit supplier. Hence the obudsmans requirement that "the credit must have been provided to the consumer under pre-existing arrangements betweenthe provider of credit and the supplier of goods and services" is met and the lender-borrower-supplier chain is established. Still needs the ombudsman to rule though. Incidentally, you are not "paying" Paypal. Money is never in a Paypal account in the same way as it would be with an agent. Paypal merely facilitate the movement of funds.

wealdroam

martmarsh wrote: »

Thanks for the responses.I think coolhotcold got it about right. Having done more research I reckon "Which" are probably right and MSE wrong.Credit suppliers have to become associates/affiliates/members to be able to send funds and merchants have to sign a Commercial Entity Agreement. This CEA establishes a legally binding contract with the credit supplier. Hence the obudsmans requirement that "the credit must have been provided to the consumer under pre-existing arrangements betweenthe provider of credit and the supplier of goods and services" is met and the lender-borrower-supplier chain is established. Still needs the ombudsman to rule though. Incidentally, you are not "paying" Paypal. Money is never in a Paypal account in the same way as it would be with an agent. Paypal merely facilitate the movement of funds.

You may be right in deciding whose posts are right and whose are wrong.
But please be sure you are making that decision based on what you believe and not on what you would like to think is right.

Your point about "paying" Paypal...
When you pay for goods via Paypal, Paypal are being paid to transfer your funds to the seller. That is a service.
If they perform that service correctly, then it is probably right that they should not be forced to refund you.

gnaril

Paypal is not covered pure and simple and its a fact that the Financial Ombudsman is of the same view.

The problem lies with Section 75 being so old and back when it was laid down was never thought it would turn into what it has today.

martmarsh

OK lets leave it there.Opinion is fine but in the absence of any new or supported verifiable "facts", I will stick with my analysis.As a post script, you may be interested to know that my bank have agreed to refund all of my claim "as a gesture of goodwill". Biggest gesture of good will I have ever had in 50 years of banking and very unlike a bank ! Maybe they are less certain of their position would stand up to scrutiny than they implied.

arcon5

martmarsh wrote: »

OK lets leave it there.Opinion is fine but in the absence of any new or supported verifiable "facts", I will stick with my analysis.As a post script, you may be interested to know that my bank have agreed to refund all of my claim "as a gesture of goodwill". Biggest gesture of good will I have ever had in 50 years of banking and very unlike a bank ! Maybe they are less certain of their position would stand up to scrutiny than they implied.

Is your "analysis" verified by "fact"?

wealdroam

martmarsh wrote: »

Opinion is fine but in the absence of any new or supported verifiable "facts", I will stick with my analysis.

Oh... and I thought you were asking for opinions.

From your original post...

martmarsh wrote: »

Anyone have any thoughts ?