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The preferential treatment of credit cards for certain transactions influences how they're used in the UK. Suppose in January two people Carol and Dave bought

The preferential treatment of credit cards for certain transactions influences how they're used in the UK. Suppose in January two people Carol and Dave bought a £250 August flight to Paris from some outfit that didn't do a great job hedging their fuel prices. Carol used her credit card, Dave used his Debit card. UK law says Carol's flight was bought by her bank, after all her bank handed over the money, Carol is on the hook to pay them back but didn't directly pay. But Dave bought his ticket, the bank isn't responsible. Today the airline fails because their fuel costs blew up. UK law says Carol should be able to get her money back from the bank because they bought this ticket and now it won't work -- this is called "Section 75". Dave may have some protections via other consumer protection rules, but he's more likely to end up losing out. The best chance for Dave might be "Chargeback" which is a card scheme which might let Dave tell his bank that he now wishes he didn't pay for the ticket. It's not very likely to work because January is a long time ago and so the bank will probably argue that Dave should have realised earlier that he didn't want to make this transaction. Because this flight touches the EU there are a bunch of extra protections which might help, none of them is as simple as Section 75. The Section 75 protections mean Brits who are credit-worthy tend to pay for large purchases on a [credit] card even if they intend to pay it off immediately.

dingaling 4mo ago
There's no reason Section 75 protections couldn't be extended to debit cards, except that in the mid-1970s banks were lobbying very hard for credit cards to become more legitimised and S75 was the successful result. The banks took on a little bit of risk and in return unlocked a free money generator. On the contrary debit cards are revenue-neutral or even loss-making for them
gpderetta 4mo ago
For what is worth, a few years ago, I was able to chargeback a significant furniture order after the company collapsed. It is indeed at the bank's discretion and my bank didn't really advertise the process, but the people in branch pointed me to the right place and the process was no fuss. So, no, you do not have the same legal protection as Section 75, but it is always worth a try.
lxgr 4mo ago
> The Section 75 protections mean Brits who are credit-worthy tend to pay for large purchases on a [credit] card even if they intend to pay it off immediately. And Visa and Mastercard's global zero liability provisions protect everybody with a debit card, so de facto the difference is no longer relevant. That said, some banks are pretty bad at making use of their dispute rights with the networks. I've seen several German issuers actually refuse to file "service not provided" disputes in case of a large airline bankruptcy a few years ago. (German bankruptcy managers can be somewhat intimidating rhetorically, but fortunately their personal opinions have no bearing on banking/payment laws.)

dingaling 4mo ago

There's no reason Section 75 protections couldn't be extended to debit cards, except that in the mid-1970s banks were lobbying very hard for credit cards to become more legitimised and S75 was the successful result. The banks took on a little bit of risk and in return unlocked a free money generator. On the contrary debit cards are revenue-neutral or even loss-making for them

gpderetta 4mo ago

For what is worth, a few years ago, I was able to chargeback a significant furniture order after the company collapsed. It is indeed at the bank's discretion and my bank didn't really advertise the process, but the people in branch pointed me to the right place and the process was no fuss. So, no, you do not have the same legal protection as Section 75, but it is always worth a try.

lxgr 4mo ago

> The Section 75 protections mean Brits who are credit-worthy tend to pay for large purchases on a [credit] card even if they intend to pay it off immediately. And Visa and Mastercard's global zero liability provisions protect everybody with a debit card, so de facto the difference is no longer relevant. That said, some banks are pretty bad at making use of their dispute rights with the networks. I've seen several German issuers actually refuse to file "service not provided" disputes in case of a large airline bankruptcy a few years ago. (German bankruptcy managers can be somewhat intimidating rhetorically, but fortunately their personal opinions have no bearing on banking/payment laws.)