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Credit Card - Section 75 cover private sales
Comments
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pacontracting wrote: »I'd like to understand the point of law that prevents you claiming against PayPal / IZettle.
Put very simply - if you use your credit card to withdraw £300 at an ATM, and spend the £300 cash on a faulty item, why should the bank have any liability?
Now consider that you have a CC with bank "A" and use it to put money into an account you have with bank "B", and then get bank "B" to pay by FP a third party. Do you think it is fair that bank "A" should have joint liability with the end third party?Optimists see a glass half full
Pessimists see a glass half empty
Engineers just see a glass twice the size it needed to be
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Put very simply - if you use your credit card to withdraw £300 at an ATM, and spend the £300 cash on a faulty item, why should the bank have any liability?
Now consider that you have a CC with bank "A" and use it to put money into an account you have with bank "B", and then get bank "B" to pay by FP a third party. Do you think it is fair that bank "A" should have joint liability with the end third party?
In that situation - I agree.
However, if company X is selling things over the internet and have a 'Pay Now with PayPal' button on their site. You click, you don't have a PAYPAL account so you enter your CC details and pay for the goods.
Equally, you are at an event and a vendor hands you an iZettle terminal to pay for your goods. You pop your CC in, type your PIN and take the goods home.
Why would S75 not apply in either case?0 -
pacontracting wrote: »In that situation - I agree.
However, if company X is selling things over the internet and have a 'Pay Now with PayPal' button on their site. You click, you don't have a PAYPAL account so you enter your CC details and pay for the goods.
Equally, you are at an event and a vendor hands you an iZettle terminal to pay for your goods. You pop your CC in, type your PIN and take the goods home.
Why would S75 not apply in either case?
Because in each case you are paying Paypal (and by the looks of things iZettle) who then pay the seller.
In the case of a merchant using a 'traditional' merchant aquirer there would be no middleman, the payments would go straight into the sellers merchant account (which they pay a fee on) with no middleman.
Section 75 is pre- Paypal/iZettle and as such it doesn't apply as using the intermediaries breaks the chain that is laid down in the CCA which therefore means that it doesn't apply, whether you (as the purchaser) realised this is an annoyance but doesn't change the substance of the transactions.0 -
Monarch Holidays charge a 5% premium if you use a credit card so some Companies play smart knowing you'll paying the cheaper cost by debit card0
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Monarch Holidays charge a 5% premium if you use a credit card so some Companies play smart knowing you'll paying the cheaper cost by debit card
According to their website it is 2.5% now (Government brought in new regulation of fees end of last year I think), or relevant to the post currently free for using Paypal (but obviously no Section 75 coverage)0 -
Wouldn't a company be happy for a 3rd party to have some of the responsibilty if things go wrong - would mean the 3rd party could get chased and not the seller.Monarch Holidays charge a 5% premium if you use a credit card so some Companies play smart knowing you'll paying the cheaper cost by debit card
CC surcharges are more to cover the extra costs of accepting CCs (and another opportunity to sneak an extra % or 2 profit) than to dissuade customers using CCs.loose does not rhyme with choose but lose does and is the word you meant to write.0 -
Because in each case you are paying Paypal (and by the looks of things iZettle) who then pay the seller.
In the case of a merchant using a 'traditional' merchant aquirer there would be no middleman, the payments would go straight into the sellers merchant account (which they pay a fee on) with no middleman.
Section 75 is pre- Paypal/iZettle and as such it doesn't apply as using the intermediaries breaks the chain that is laid down in the CCA which therefore means that it doesn't apply, whether you (as the purchaser) realised this is an annoyance but doesn't change the substance of the transactions.
I actually think PAConsulting makes a good case, in the examples he cites the buyer could be forgiven for thinking they are dealing directly.
It makes one wonder if one could break the link deliberately - so for example have two companies, Acme Kitchens and Acme Payment Services. The client pays the latter by credit card, who in turn pay the former in cash. The client knows no better until they come to make an S75 claim against Acme Kitchens.Optimists see a glass half full
Pessimists see a glass half empty
Engineers just see a glass twice the size it needed to be0 -
Wouldn't a company be happy for a 3rd party to have some of the responsibilty if things go wrong - would mean the 3rd party could get chased and not the seller.
CC surcharges are more to cover the extra costs of accepting CCs (and another opportunity to sneak an extra % or 2 profit) than to dissuade customers using CCs.
I don't think the CC would see it that way. If the CC gets pursued and has to refund money, then they will go straight to the vendor to recover that.Optimists see a glass half full
Pessimists see a glass half empty
Engineers just see a glass twice the size it needed to be0 -
It makes one wonder if one could break the link deliberately - so for example have two companies, Acme Kitchens and Acme Payment Services. The client pays the latter by credit card, who in turn pay the former in cash. The client knows no better until they come to make an S75 claim against Acme Kitchens.
Indeed for a while this was happening alot. A number of retailers including supermarkets, M&S etc were all doing it. It wasn't because of S75, but to avoid VAT. Eg take a £100 suit. The VAT will be £16.67, so the shop gets £83.33.
Now at the checkout there was a small sign saying that if you use a CC, the payment would be processed "on your behalf" by XXX Payment Services for which a 5% charge would be made but that the overall cost would be the same. No VAT on payment services at that time. So the new "price" would be £95.23. The VAT included in that would be £15.87. So on a VAT inclusive purchase of £100, the shop would make an extra 80p.
The "loophole" was eventually stopped. Don't remember seeing any S75 stuff on this though.0 -
I actually think PAConsulting makes a good case, in the examples he cites the buyer could be forgiven for thinking they are dealing directly.
It makes one wonder if one could break the link deliberately - so for example have two companies, Acme Kitchens and Acme Payment Services. The client pays the latter by credit card, who in turn pay the former in cash. The client knows no better until they come to make an S75 claim against Acme Kitchens.
Not disagreeing on that point, but the substance of the transaction (for this specific point) governs whether Section 75 applies, not what the buyer knows, it has been widely punted as a 'loophole' in Section 75 legislation, as such services weren't envisaged when the legislation wass enacted.0
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