Chargeback advice - Mastercard / Monzo

TinyVoice

Ok, so here's a thing.

In May 2024, I signed a contract with a sash window renovation company and paid £5397 using my Monzo debit card (Mastercard logo) in my home. I asked to cancel 5 days after making payment and signing their contract. They had built in a 'I waiver my rights to a 14 day cancellation period' within the contact.  Which was a nice to discover in the small print after the man who had driven 8 hours on a Saturday morning to my home and eager to seal the deal, had left.  The company became very difficult very quickly once they knew I wanted to cancel their services so I started a chargeback through Monzo.

In June, the company agreed to the chargeback providing that £917 was repaid for losses incurred within the 5 day period after signing the contract. Monzo took back the £917. I told them that I was anxious that the company would honor the rest of the amount at arbitration. Monzo offered me some kind of wellness manager to chat through things and to make sure I could keep up with my outgoing payments.  I had taken out a home improvement loan with them to cover the cost paid for the windows I had cancelled.

In September I wrote to Monzo and asked what would happen should the company go into liquidation with the outstanding amount for the chargeback and was told that I shouldn't get involved with hypothetical situations and I should go to the financial ombudsman if I was unhappy with how Monzo was dealing with the chargeback.

So I did.  The Financial Ombudsman has kindly explained that because I paid by a debit card - although it has a Mastercard logo - it is not afforded the same protection as a regular credit card.  I do not have a credit card.  I stupidly thought that having a Mastercard logo would offer me a level of protection.

In November, I received a letter from an insolvency agency telling me that the window company had gone into voluntary liquidation and I am one of thirty six others who will be left without money or the service promised (chargeback not withstanding).  I had warned Monzo that I believed this company would do this and no-one took me seriously. With the company now in liquidation, I have paid for something that I have never received nor am likely to. And Monzo will be unlikely to get the charge back from the company either I'm thinking.

The Financial Ombudsman have been dealing with this since September and are still yet to give a response. They have been helpful to explain that if the chargeback is not successful with Monzo, I could try to seek to dispute with Mastercard directly. A dispute with Mastercard is not something that the financial ombudsman can help with.

But how?  There is nothing I can find online on how to get a dispute lodged with Mastercard for those who do not have a credit card. For a debit card, they send you on a loop back to your bank.  Does anyone know how to directly access Mastercard for arbitration, please?  An email address?  A helpline?  Something?

DullGreyGuy

TinyVoice said:

In May 2024, I signed a contract with a sash window renovation company and paid £5397 using my Monzo debit card (Mastercard logo) in my home. I asked to cancel 5 days after making payment and signing their contract. They had built in a 'I waiver my rights to a 14 day cancellation period' within the contact.  Which was a nice to discover in the small print after the man who had driven 8 hours on a Saturday morning to my home and eager to seal the deal, had left.  The company became very difficult very quickly once they knew I wanted to cancel their services so I started a chargeback through Monzo.

In June, the company agreed to the chargeback providing that £917 was repaid for losses incurred within the 5 day period after signing the contract. Monzo took back the £917. I told them that I was anxious that the company would honor the rest of the amount at arbitration. Monzo offered me some kind of wellness manager to chat through things and to make sure I could keep up with my outgoing payments.  I had taken out a home improvement loan with them to cover the cost paid for the windows I had cancelled.

So, you paid for the windows in full up front?

I'm unclear what is actually happening with the £917? I think you did a chargeback for the full £5,397, the bank refunded you straight away and warned it may be reversed, they contested it, you came to an agreement to pay £917 so the chargeback was partially reversed. 

Given you already have the rest of the money back what's the problem?

A chargeback is funded by the merchants bank, they in turn will get the money back from the merchant themselves but its their problem not Monzo or yours if the company is insolvent. 


S75 has nothing to do with which network logo is on the front of your card, its Section 75 of the Consumer Credit Act which applies to all regulated lending. S75 simply makes the lender jointly liable with the supplier as long as conditions are met. You paid with a debit card so it wasnt lending and so not regulated credit so no S75. 

born_again

TinyVoice said:

Ok, so here's a thing.

In May 2024, I signed a contract with a sash window renovation company and paid £5397 using my Monzo debit card (Mastercard logo) in my home. I asked to cancel 5 days after making payment and signing their contract. They had built in a 'I waiver my rights to a 14 day cancellation period' within the contact.  Which was a nice to discover in the small print after the man who had driven 8 hours on a Saturday morning to my home and eager to seal the deal, had left.  The company became very difficult very quickly once they knew I wanted to cancel their services so I started a chargeback through Monzo.

In June, the company agreed to the chargeback providing that £917 was repaid for losses incurred within the 5 day period after signing the contract. Monzo took back the £917. I told them that I was anxious that the company would honor the rest of the amount at arbitration. Monzo offered me some kind of wellness manager to chat through things and to make sure I could keep up with my outgoing payments.  I had taken out a home improvement loan with them to cover the cost paid for the windows I had cancelled.

In September I wrote to Monzo and asked what would happen should the company go into liquidation with the outstanding amount for the chargeback and was told that I shouldn't get involved with hypothetical situations and I should go to the financial ombudsman if I was unhappy with how Monzo was dealing with the chargeback.

So I did.  The Financial Ombudsman has kindly explained that because I paid by a debit card - although it has a Mastercard logo - it is not afforded the same protection as a regular credit card.  I do not have a credit card.  I stupidly thought that having a Mastercard logo would offer me a level of protection.

In November, I received a letter from an insolvency agency telling me that the window company had gone into voluntary liquidation and I am one of thirty six others who will be left without money or the service promised (chargeback not withstanding).  I had warned Monzo that I believed this company would do this and no-one took me seriously. With the company now in liquidation, I have paid for something that I have never received nor am likely to. And Monzo will be unlikely to get the charge back from the company either I'm thinking.

The Financial Ombudsman have been dealing with this since September and are still yet to give a response. They have been helpful to explain that if the chargeback is not successful with Monzo, I could try to seek to dispute with Mastercard directly. A dispute with Mastercard is not something that the financial ombudsman can help with.

But how?  There is nothing I can find online on how to get a dispute lodged with Mastercard for those who do not have a credit card. For a debit card, they send you on a loop back to your bank.  Does anyone know how to directly access Mastercard for arbitration, please?  An email address?  A helpline?  Something?

On what basis was the chargeback?
As debit cards do not cover consumer rights, only the rights the Mastercard regulation allow.

How much were you refunded when the chargeback was started? Should have been £5397

Monzo are right, they can only deal with the now, not the possible future actions.


So retailer did not agree to the chargeback or Monzo would not have paid the money back. 

TBH, FOS will not get involved with chargebacks, as it is internal process & as long as Monzo followed Mastercard regulations then they have done nothing wrong.



Sadly you can not chase Mastercard for your money. They have nothing to do with this, other than providing Monzo with the right to use their logo on the card.

One thing to be clear on is that Chargebacks are card regulations, They are not binding under any legal standing. They are over & above your consumer rights. 

Mastercard do offer a level of protection. They provide chargeback rights. Which like S75 is not a get out of jail free card.

Had this been on a Maestro card years ago. The answer would have been nothing we can do.

TinyVoice

No, £5397 was the first instalment of a total bill of £8800.  The £917 was an arbitrary amount plucked by the window company for 'losses incurred due to cancellation' which Monzo felt were reasonable to rack up in 5 days with no technical drawings in place and simply to cover the cost of sending a 'closer' not a surveyor to my home to take this money.  The company told Monzo that they would accept the chargeback if the £917 was paid. 

In October Monzo told me that the remainder of the money given the chargeback would be taken from my account. I was already talking to the Financial Ombudsman who told me to tell them to hold off taking the money until the case was closed.  But I am simply preparing myself with Mastercard's details so that when the Financial Ombudsman find nothing untoward with Monzo's dealings with the matter, I have another option of getting in touch with Mastercard to try and recoup the £4480 I will have lost.

Thank you for clearing up any doubt I may have had about debit vs credit card.

TinyVoice

born_again said:

TinyVoice said:

Ok, so here's a thing.

In May 2024, I signed a contract with a sash window renovation company and paid £5397 using my Monzo debit card (Mastercard logo) in my home. I asked to cancel 5 days after making payment and signing their contract. They had built in a 'I waiver my rights to a 14 day cancellation period' within the contact.  Which was a nice to discover in the small print after the man who had driven 8 hours on a Saturday morning to my home and eager to seal the deal, had left.  The company became very difficult very quickly once they knew I wanted to cancel their services so I started a chargeback through Monzo.

In June, the company agreed to the chargeback providing that £917 was repaid for losses incurred within the 5 day period after signing the contract. Monzo took back the £917. I told them that I was anxious that the company would honor the rest of the amount at arbitration. Monzo offered me some kind of wellness manager to chat through things and to make sure I could keep up with my outgoing payments.  I had taken out a home improvement loan with them to cover the cost paid for the windows I had cancelled.

In September I wrote to Monzo and asked what would happen should the company go into liquidation with the outstanding amount for the chargeback and was told that I shouldn't get involved with hypothetical situations and I should go to the financial ombudsman if I was unhappy with how Monzo was dealing with the chargeback.

So I did.  The Financial Ombudsman has kindly explained that because I paid by a debit card - although it has a Mastercard logo - it is not afforded the same protection as a regular credit card.  I do not have a credit card.  I stupidly thought that having a Mastercard logo would offer me a level of protection.

In November, I received a letter from an insolvency agency telling me that the window company had gone into voluntary liquidation and I am one of thirty six others who will be left without money or the service promised (chargeback not withstanding).  I had warned Monzo that I believed this company would do this and no-one took me seriously. With the company now in liquidation, I have paid for something that I have never received nor am likely to. And Monzo will be unlikely to get the charge back from the company either I'm thinking.

The Financial Ombudsman have been dealing with this since September and are still yet to give a response. They have been helpful to explain that if the chargeback is not successful with Monzo, I could try to seek to dispute with Mastercard directly. A dispute with Mastercard is not something that the financial ombudsman can help with.

But how?  There is nothing I can find online on how to get a dispute lodged with Mastercard for those who do not have a credit card. For a debit card, they send you on a loop back to your bank.  Does anyone know how to directly access Mastercard for arbitration, please?  An email address?  A helpline?  Something?

On what basis was the chargeback?
As debit cards do not cover consumer rights, only the rights the Mastercard regulation allow.

How much were you refunded when the chargeback was started? Should have been £5397

Monzo are right, they can only deal with the now, not the possible future actions.


So retailer did not agree to the chargeback or Monzo would not have paid the money back. 

TBH, FOS will not get involved with chargebacks, as it is internal process & as long as Monzo followed Mastercard regulations then they have done nothing wrong.



Sadly you can not chase Mastercard for your money. They have nothing to do with this, other than providing Monzo with the right to use their logo on the card.

One thing to be clear on is that Chargebacks are card regulations, They are not binding under any legal standing. They are over & above your consumer rights. 

Mastercard do offer a level of protection. They provide chargeback rights. Which like S75 is not a get out of jail free card.

Had this been on a Maestro card years ago. The answer would have been nothing we can do.

Thank you for your helpful comments. Just to answer, the basis of the chargeback was that Citizen's Advice advised me to take this route to try and get my money back for a service that I cancelled within the 14 day cooling off period.  They told me that it was unlawful of any trader to deny a consumer of these rights and therefore it was not a legal contract, This rang alarm bells and at this point, I told Monzo that I believed this was not a legitimate business.  

TinyVoice

Can I just ask what is the point of a Mastercard logo on a debit card if this totally disassociated with any benefit that Mastercard can offer?  Just interested as to why.  Thank you.

born_again

TinyVoice said:

No, £5397 was the first instalment of a total bill of £8800.  The £917 was an arbitrary amount plucked by the window company for 'losses incurred due to cancellation' which Monzo felt were reasonable to rack up in 5 days with no technical drawings in place and simply to cover the cost of sending a 'closer' not a surveyor to my home to take this money.  The company told Monzo that they would accept the chargeback if the £917 was paid. 

In October Monzo told me that the remainder of the money given the chargeback would be taken from my account. I was already talking to the Financial Ombudsman who told me to tell them to hold off taking the money until the case was closed.  But I am simply preparing myself with Mastercard's details so that when the Financial Ombudsman find nothing untoward with Monzo's dealings with the matter, I have another option of getting in touch with Mastercard to try and recoup the £4480 I will have lost.

Thank you for clearing up any doubt I may have had about debit vs credit card.

So you still have a refund of £4480 then?

So if Monzo take that back, then that is 100% that retailer contested & won the chargeback. That is because they did nothing wrong within the chargeback regulations.
Despite breaking consumer rights. Which would allowed you to go to court to claim funds back.

I would say to Monzo, that you are happy to pay this back direct to the companies administrator's should they contact you. But will they leave this in your account, given the company is not longer trading.

If they won't then the only option would be to go to court, but that would be a waste of time & money if the company have no money.

TinyVoice

TinyVoice said:

Can I just ask what is the point of a Mastercard logo on a debit card if this totally disassociated with any benefit that Mastercard can offer?  Just interested as to why.  Thank you.

Call off the dogs. Have googled it.  And have taken my place in the League of Dunces.  At the top.

TinyVoice

born_again said:

TinyVoice said:

No, £5397 was the first instalment of a total bill of £8800.  The £917 was an arbitrary amount plucked by the window company for 'losses incurred due to cancellation' which Monzo felt were reasonable to rack up in 5 days with no technical drawings in place and simply to cover the cost of sending a 'closer' not a surveyor to my home to take this money.  The company told Monzo that they would accept the chargeback if the £917 was paid. 

In October Monzo told me that the remainder of the money given the chargeback would be taken from my account. I was already talking to the Financial Ombudsman who told me to tell them to hold off taking the money until the case was closed.  But I am simply preparing myself with Mastercard's details so that when the Financial Ombudsman find nothing untoward with Monzo's dealings with the matter, I have another option of getting in touch with Mastercard to try and recoup the £4480 I will have lost.

Thank you for clearing up any doubt I may have had about debit vs credit card.

So you still have a refund of £4480 then?

So if Monzo take that back, then that is 100% that retailer contested & won the chargeback. That is because they did nothing wrong within the chargeback regulations.
Despite breaking consumer rights. Which would allowed you to go to court to claim funds back.

I would say to Monzo, that you are happy to pay this back direct to the companies administrator's should they contact you. But will they leave this in your account, given the company is not longer trading.

If they won't then the only option would be to go to court, but that would be a waste of time & money if the company have no money.

Thank you for your help.  You have answered all you can and to the best of your knowledge.  Really grateful for your time to give such a full explanation and eventual outcomes.  We shall leave this here. 

km1500

Just for clarity, the reason you get s75 protection with a credit card is nothing to do with Mastercard or Visa. It is due to the fact that you are taking out credit.

You will get the same protection if you had, for example, taken out a finance agreement with the window company

TinyVoice

km1500 said:

Just for clarity, the reason you get s75 protection with a credit card is nothing to do with Mastercard or Visa. It is due to the fact that you are taking out credit.

You will get the same protection if you had, for example, taken out a finance agreement with the window company

Thank you so much for clearing this up so nicely.  I really appreciate it.