The safest ways to pay – however and wherever you shop

There are so many forms of payment these days, how do you know which one is most secure? We have the answers…

SPENDING OVER £100 ONLINE

Credit or store cards have instant legal protection under Section 75 of the Consumer Credit Act. You can ask your card company for a refund if a supplier goes bust, goods are faulty or don’t arrive. ‘But for section 75 claims, buy direct, not through a third party (including Paypal), because if the money doesn’t go direct to the supplier, the law doesn’t apply,’ explains Martyn James, consumer expert from issue resolution service Resolver.

SPENDING UNDER £100 ONLINE

Pay by debit or credit card for protection under the Chargeback scheme. Unlike Section 75, it’s not enshrined in law but is an industry scheme, with Visa, Mastercard and American Express on board. To make a claim, there must be a ‘breach of contract’, such as a firm going bust or goods not arriving. In this case, ask your bank to do a Chargeback (this involves reversing the transaction with the supplier’s bank, so you get a refund). You may be given the option to pay by Paypal, but cards offer more protection, says Martyn James: ‘Chargeback trumps Paypal as it’s more instant, if, say, a firm looks like it’s going to go under.’

GH TIP Always check out a company’s return policy before you buy online

SHOPPING ON THE HIGH STREET

Cards give the best protection. But even if you pay cash, if you have a receipt, there should be no problem with refunds or replacements if items are faulty.

AT THE MARKET

Cash is best for ‘haggling’, and some traders do not accept cards. But, if you pay cash and there’s a problem, unless you buy from a regular trader and have a receipt, refunds could prove tricky.

ONLINE MARKETPLACES

Paypal’s best for sites such as ebay, Vinted and Depop. If you don’t receive goods, or they don’t match the description, Paypal’s built-in ‘Buyer Protection’ means you can claim for a full refund up to 180 days from payment. This also applies to purchases made with Paypal Credit.

BANK TRANSFERS

While this is a safe and fast way to send money, it’s harder to get your money back. Being persuaded to pay for holidays by bank transfer is a common scam and if there’s a problem, banks take the view that you ‘authorised’ the transaction so they may not help. Instead, pay by card for added protection.

IS IT SAFE TO PAY WITH APPLE AND GOOGLE PAY?

When you add a credit or debit card to your digital wallet, details are encrypted, not stored on your phone, so are secure. Both Section 75 protection and Chargeback apply with mobile payments.

CAN I PAY WITH BITCOIN?

Martyn James says it’s still more of an ‘investment’ than a way to pay, and we’re years away from it being typical currency.