Laws which protect credit card customers from finding themselves out of pocket from a prepayment transaction should be extended to debit products, one organisation has warned.
Currently, when a consumer pays for an item up front with a credit card but does not receive it, the provider of the plastic must cover the costs, but this should also be the case with debit products, Consumer Focus said.
Research by the watchdog showed that the average amount lost by customers who made prepayments on a credit card but did not receive a service or goods came to £242, while the main reason was companies going into administration .
Steve Brooker, markets expert at Consumer Focus, said: "Better protection of prepayments is in everyone's interest. Consumers will be reassured that their money is safe, which will encourage spending and help keep a valuable source of credit open to struggling businesses."
moneysupermarket.com recently reported that credit card provider Virgin Money has introduced a new zero per cent balance transfer product onto the market, with no fees for nine months.
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Consumer Focus calls for similar regulations for debit and credit cards
Tue, 11 Aug 2009
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