Additional Credit Card holders may not be fully protected.

    Banks are taking a hard line on giving refunds for breach of contract because of a loophole in consumer protection law.

    The law in question is the Consumer Credit Act (CCA), and under section 75, retailers and card issuers are equally liable for any breach of contract or misrepresentation; providing the transaction exceeds £100 but not £30,000.

    But Computeractive is warning people that, despite a widely held belief, spouses and partners of the card holder who opened the account, the primary cardholder, do not have the same rights when they use their allotted secondary card.

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    1 Comment

    Thanks for posting this - I had no idea and am horrified as my husband has a secondary mastercard to mine. Luckily he's forgotten his pin number so I tend to pay. Time to get a new credit card for him.

    "....Many credit card customers will be shocked to find out that purchases by their secondary cardholder may not be covered in the same way as purchases by the named cardholder. Credit card companies must make clear to customers exactly what transactions they will insure.

    “In the same way that a main cardholder must keep their end of the bargain by paying for purchases made by secondary cardholders, people will expect credit card companies to keep their end of the deal by covering all transactions.”

    When we contacted the Office of Fair Trading (OFT) for clarification about the law, the consumer regulator told us that this is a “complex area” and likely to depend on the circumstances of each case.

    Although the primary cardholder has to make any claim, even if a secondary card has been used, the consumer watchdog said in its opinion secondary card holders should be protected. It said: “In general, the OFT has taken the view that an authorised second card-user is acting as agent of the principal cardholder.”

    But the four major UK credit card issuers we spoke to disagreed.

    Lloyds TSB said in a statement: “We would not pay out in this situation as the secondary cardholder is not covered by section 75, as the contract for the goods is not with the principal cardholder (who is the person who has a contract with us).

    “Therefore as the principal cardholder would have no claim against the merchant (as he has no contract with them) he cannot have a like claim against us.” Similar views were also expressed by Barclaycard, RBS and HSBC.

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