Credit Card Guides

Credit card protection options explained

Protections offered by credit cards and their advantages:

Section 75 and payment protection

One of the main advantages all credit cards have is payment protection. Under Section 75 of the Consumer Credit Act, if any purchase between £100 and £30,000 is made in whole or in part with a credit card and the goods or services turn out to be unsatisfactory (or not what was advertised), you can get the money back from your card provider (who will then try to get a refund from the supplier of the goods or services). This protection applies even if the seller has gone bankrupt or is not responding to communication.

It’s also worth bearing in mind that if there is a third party involved in the payment, such as a ticket agent or PayPal, depending on the transaction you may not be protected by Section 75. It also doesn’t apply to cash withdrawals, and also may not apply if the purchase was made with the card by anyone else other than the primary cardholder.


This differs from chargeback, which offers another kind of protection. While Section 75 protects purchases over £100, chargeback is not protected under law but is offered by most card providers anyway for purchases under this amount. While not legally binding on the merchant, it offers a good way to reclaim money paid for goods that aren’t delivered or not as advertised.

The chargeback protection period is only valid for a certain period, usually 120 days after purchase. It’s worth noting that the officially recorded date of purchase can be counter-intuitive, for example in the case of flight bookings the purchase date refers to the actual day the flight is scheduled for.

Between chargeback and Section 75, credit cards offer extensive protection and this is one of their main advantages. However, the details of the transaction and your contract with the provider define how covered you are.

One step further: Purchase protection

On top of the two protection methods mentioned above, some cards also offer purchase protection. This extends beyond chargeback and Section 75 protection, allowing you to redeem the cost of a purchase in the event of loss or theft of the item. This is similar to insurance, but it must be noted that your items cannot be double-covered, i.e. if you already have the item insured then you must claim from your insurance provider and not the credit card company as the insurance cover takes precedence.

Unlike insurance, this protection only applies to the first 90 days after purchase. It also differs from insurance in that it is set regardless of the amount purchased, i.e. there is no increase in premium to be paid with extra purchases made. There is a cost, however, and that is the annual fee paid to use a card with such protection. These are usually premium credit cards, such as American Express Platinum Cards. There are also limits to this protection; in the case of the AmEx card just mentioned, you have to pay £50 excess (in effect limiting the claim to purchases over this amount), and claims are limited to £2,500 per claim and £20,000 annually in total.

Identity theft cover

If it applies to your credit card, this protection could be the most valuable to protecting your finances. In the event of someone illegally using your card to make purchases, with this protection you can claim back the defrauded amounts. This is not offered with all cards, and usually only applies to cards with annual fees. However, even if you don’t need this cover it can save you money when protecting your finances, as the service usually offers a number of free checks on your credit file per year. This usually costs money, and can be a great way to prevent and resolve anyone taking out loans or credit card applications in your name.

Type of protection What cards does it apply to? Cost Other notes
Section 75 protection All cards Free Does not apply to charge cards
Chargeback Most cards, depending on the provider Free
Purchase protection Certain (premium) cards Annual fee and excess Limits per card
Identity theft cover Certain cards Annual fee


It’s clear one of the main benefits of credit cards are the protection methods offered. These can help you in the long and short term, and could inform how you pay for goods. For example, if you’re making a purchase of £150 online, it might be an idea to use your credit card instead of a debit card or online bank transfer. And in the case of a big purchase, maybe pay for the first £100 on your credit card and the rest by other means, so the transaction is covered under Section 75 but there’s no chance of you running up a high credit card interest bill.

There are many options, so finding the right card can save you a lot in the long run.