How do credit card companies recoup section 75 claims?

TomBridges

I've had a section 75 claim against a purchase on my Credit Card approved by Barclaycard.
Question: Do Barclaycard recoup this money somehow from the seller?, or is this just a cost the Credit Card company have to take on?

[Deleted User]

It's a cost.

They may be able to recoup if from sellers in some instances, but it;s otherwise built in the pricing structure.

Terry_Towelling

When I worked in cards, the money was often lost but there were occasions where it was charged back to the sellers' bankers and some where the card company took possession of the goods and sold/auctioned them.

eco_warrior

It’s budgeted for but banks can auction goods to help recoup some costs but that’s pretty minimal in my experience.

Banks can also cut deals with the merchant and split costs but again this is minimal.

Chrysalis

Its a loss on the transaction but in the overall revenue the card business remains profitable, these cc companies make money in various ways so they will survive.

e.g. when you do a chargeback, the company at the other end not only has to return the money but also a fee is charged to them.

chattychappy

Often people are drawn to this forum because of problems they have had. Most card users just don't have problems or if they do, do not know about or think of S75.

I can say that in over 30 years of using credit cards, I have never personally made a S75 claim.

I think they are not as common as people on here might think. Also CCs have a number of techniques (justified or otherwise) which get rid of potential claims - eg demanding expert reports, being told they have to pursue the merchant first or just denying liability. I'm sure many claims are misconceived, but likewise a number of people with good claims just can't be bothered. Some S75 claims would be handled via chargeback.

Personally I would like to see S75 repealed, or at least reformed. I do feel that it is a kind of "insurance" that is forced on me whether I want it or not. We all pay, however small the cost might be.