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Cash: Your problems: Driven round the bend by Tesco Bank's refusal to refund

January 19, 2014

Anna Tims

I think your readers should be aware that Tesco Bank consider all deposits paid using its credit card to be non-refundable and uses that as an excuse to avoid paying a refund under Section 75 of the Consumer Credit Act. I paid a deposit of pounds 100 with my Tesco Credit Card for the purchase of a second-hand car. I never took delivery of the car as the dealer failed to carry out promised remedial works. Although the dealer verbally agreed to refund the deposit this has never materialised. I made a claim to Tesco Bank under Section 75, but it told me that deposits are not covered by the act. AP, Mere, Wiltshire You are the second reader in as many months who has found Tesco Bank has a tenuous grasp of the Consumer Credit Act. This legislation gives customers the same rights against their credit card issuer as against a retailer which breaches a contract, provided the money paid is between pounds 100 and pounds 30,000. Not only are deposits specifically covered by the act, section 75 takes into account the full price paid for the goods by any method, not just the part paid for by credit card. So if you had paid that pounds 100 deposit on your credit card and then written a cheque for the balance, your card issuer would have been liable for the total outlay. The Financial Ombudsman Service is the place to go if your bank won't cough up, but happily, you won't be needing the regulator just yet. Tesco tells me that following a "review" (ie media interest) it has decided to uphold your claim. "We've apologised to the customer, given him a pounds 50 gesture of goodwill and taken steps to prevent this happening again," says a spokesman.

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Source: Observer (UK)

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