Published Tuesday, 18 December 2012
In these tough economic times people are naturally more cautious of how their money is spent.
Sadly, with an increasing number of businesses facing financial difficulties, it's more important than ever to know how to protect your goods, pre-payments and savings in case a business goes bust.
The Consumer Council wants to remind customers of the safest ways to pay for goods and services so that their hard earned cash is protected during the festive period and forthcoming sales.
The Consumer Council's Safer Ways to Pay guide highlights the level of protection you have if things go wrong depending on the payment method, i.e. by credit or debit cards, cash or cheques.
We are encouraging consumers to consider how best to pay for goods to avoid being left out of pocket. Telephone for your free copy on 0800 121 6022.
Cash or Cheque
Paying by cash or cheque can be risky if you have to wait for goods to arrive. If you pay for something this way and the business goes bust before the goods arrive, you could end up with nothing
Top tips to reduce the risk
1. If possible, pay a small deposit for the item and get a receipt.
2. Confirm that you will pay the balance the day before or as close as possible to the delivery date.
3. If you are in a shop and they insist that you pay in full before delivery, write your name and address on the packaging if the item is in stock. This will mean that if the business goes bust, you may still receive your goods.
4. If the goods aren't in stock, get written confirmation from the business of the expected delivery date.
5. Think carefully before deciding to pay the full amount in advance, especially if there's a long delivery period.
If you're buying a single item costing between £100 and £30,000, it may be worth paying by credit card as this gives you added protection if something goes wrong. This protection is known as equal or joint liability and it means that by law, the credit card company must help in cases of faulty goods or non-delivery if the retailer goes out of business.
Remember try to pay the amount off in full when you get the bill to avoid paying interest.
Visa Credit Card
If you use a Visa credit card for goods costing under £100, your card provider can use the 'Chargeback' process to claim money back for you. Charge back is part of Visa scheme rules and can be used in cases where goods don't arrive, arrived damaged, don't match the description given or where the business has gone bust. The rules cover payments made by prepaid Visa credit cards (that you top-up as you go), Visa debit cards and Visa Electron.
You have 120 days to make a claim through Chargeback starting from the day you become aware of a problem.
Many websites use online payment processors such as PayPal, Google Checkout or WorldPay. The law in this area is uncertain so if a problem arrises it is unlikely you will be able to claim against the credit card company as the payment does not go directly from the company to the seller.
Christmas Saving Club
Treat Christmas saving cards and stamps like cash. Keep them safe because of they are lost or stolen you could lose your money, as the company may not have a record of who owns the cards or stamps or how much they have saved.