How banks determine in the event you get your a refund if one thing goes improper: ADELE COOKE goes inside Nationwide and divulges what will get your declare rejected

Jamie McPartland is trying to make sense of a takeaway receipt from a local Indian curry house.

Sitting at his desk in an office building at Nationwide Building Society’s headquarters in Swindon, he studies the document on screen for evidence.

Someone has emailed the receipt to customer service to claim for a partial refund, as when his meal arrived it was missing the poppadoms and samosas he had ordered and paid for.

Deciphering takeaway receipts may not seem like a job for a bank member but Jamie is among a team at Nationwide that processes 1,500 such cases each week under the so-called chargeback scheme.

I’m here at Nationwide’s headquarters in the Wiltshire town to meet Jamie and the rest of the large team that deal with these requests.

Chargeback offers customers the right to ask their credit or debit card provider to reverse a transaction that is worth less than £100 up to 120 days after something has gone wrong.

This could be due to goods or services they have purchased being faulty, not as described or never delivered. The bank or building society can then withdraw these funds from the retailer’s account and put them back in the customer’s account.

Those who paid with a credit card and spent more than £100 but less than £30,000 are also covered in a similar way by Section 75, a vital legal protection which is part of the Consumer Credit Act.

You have 120 days to submit a chargeback claim and six years to submit a Section 75 claim but you should do so as soon as you notice a fault with a product or service.

The Swindon office is a hive of activity as members of Nationwide’s 16-strong chargeback unit work together – or alone if the case is straightforward – to resolve customer claims. In some cases, they seek help from an in-house lawyer as well.

Nationwide also has a group – separate to its chargeback team – of ten legal experts who handle around 100 Section 75 cases every month. In the corner of the room, three members of staff sit inside a wooden garden hut-shaped meeting room intensely discussing a case.

Most customers submit claims to the building society using an online form, but customers can also make a chargeback or Section 75 claim by telephone, post or in branch.

In the case of the Indian takeaway, Jamie will have to go back to the customer for more information as he has uploaded only half of the receipt and has not provided key details, such as dates and times about when the delivery took place.

He will also seek to understand whether the customer had asked for a refund directly from the restaurant. Under both chargeback and Section 75, banks will typically step in only when a request for a refund has been denied.

Jamie will need to be armed with this information to go back to the restaurant in question to make the case for chargeback.

‘We only get one chance to submit a chargeback claim [to the retailer] so we need to make sure it’s right first time,’ he says.

To avoid a customer being out of pocket, a bank such as Nationwide pays the customer while the claim is processed but will re-debit the money if the claim is rejected.

With chargeback on a credit card, Nationwide either applies a credit straight away to the customer’s credit card or places the payment into dispute, which freezes the transaction. If the claim is successful, the transaction is credited to the account to offset the debit.

With Section 75, a bank will typically assess if the claim meets the criteria and the amount paid using the creditcard will usually be given back to a customer credit card.

If the customer has used their credit card as part payment for the item in dispute, any additional loss due over the amount paid on the credit card can be paid to the customer using another method.

Depending on the claim, only a portion of the cost may be refunded. For example, if you have an item and can use it for a period of time but then it becomes broken/faulty. If a claim fails to meet the criteria, a bank informs the customer.

For a chargeback claim, Nationwide receives money from the retailer if successful. Under Section 75, Nationwide is jointly liable with the retailer, so where possible it looks to recoup the loss via them but if not, the bank is liable.

If the retailer refuses to return customer money over a valid decline, a bank will accept the decision and re-debit the customer funds. However, if Nationwide disagrees with the retailer, it can resubmit the claim again with further evidence and/or take it to Visa (Nationwide’s card scheme provider), who would independently rule on the claim.

With Section 75, Nationwide is jointly liable with the retailer so is liable for the loss if it can’t recoup money.

Jamie’s next case is equally challenging. A Nationwide customer has submitted a chargeback claim after she ordered gym clothes online, but when they arrived they were the wrong colour.

The customer’s chargeback claim describes the items that arrived as ‘blue bottoms’ when she had ordered black ones. Jamie will have to go back to her to find out whether by ‘bottoms’ she meant leggings, shorts or skirts. His third case already contains a great deal of information from the customer – and as a result is likely to proceed quickly. The Nationwide customer had ordered some garden furniture but it had not arrived weeks later.

The customer submitted a receipt that confirmed the purchase and a log of when they had spoken to the seller to try to resolve the issue directly.

In a clear case such as this, the team can send off a claim to a retailer and get a response within a few days. But, without the necessary evidence, the entire process can take up to four months.

Debbie Weston, a customer-service manager, says evidence is key when making a claim.

‘All we see when a purchase is made is the transaction, we don’t know the terms that were agreed or what they signed up to,’ she says. ‘If there is a problem with an item, then we need to know why. Was it the wrong size? Is it damaged? Why is there a problem?’

She advised that customers always describe why there is a problem with the item or service you have purchased. The more detail you include in the description you give your card provider, the less back and forth you are likely to have with them. Mention if an item is the wrong size, colour or if it is damaged, and take pictures to back up your claim.

Always keep emails from the retailer and save any receipts, which should make it easier if you need to make a claim. You should also take photos when you receive an incorrect item or something that is faulty as this can also be used as evidence.

When making a large purchase, always pay for part of it using your credit card. Even if you just pay a deposit with your credit card, for example when you book a holiday, then the whole value of the goods or service purchased will still qualify for Section 75 protection.

Most of the claims the team processes are for missing airline refunds or online clothing orders where the items have arrived in the wrong size or colour.

Debbie says: ‘We also see themes, for example if an airline goes under then we will see lots of claims. Often around Christmas, there is a surge in cases too.’

Any credit card claims which don’t meet the criteria for chargeback are automatically passed to the Section 75 team, who work on a case-by-case basis.

Retailers have much longer to process a Section 75 claim than a chargeback claim and some of the most complex cases can drag on for almost a year.

One of the biggest differences between chargeback and Section 75 is that with the latter you can claim for subsequent losses that are a result of the poor service or product. For example, you could receive compensation if you are forced to move out of your home and into a rental property because of an unsafe roof repair.

There are also greater protections if a company goes bust, explains Matthew Roberts, who heads up the Section 75 team.

‘If a company goes into liquidation, we will contact the administrators. If we can’t get the money back from the merchant, then we will refund the buyer ourselves.

‘As soon as a claim comes in, we will freeze the transaction on the customer’s credit card, so it is taken out of their monthly payments and any interest is frozen.

‘With these cases, the user needs to show whether there was a breach of contract or misrepresentation and was there a subsequent loss linked to that. They also need to confirm this with proof.’

A breach of contract happens when a company violates any of the agreed-upon terms and conditions of a binding contract, which can include not delivering the right goods or providing a service on time.

If a customer finds a fault with a product within the first six months after it was purchased, it is presumed that the issue was there at the time of purchase and it is up to the retailer to prove that it wasn’t.

But after six months, this reverses from the retailer to the consumer and it is up to them to prove that the item was faulty when it was purchased.

Many of the cases the team deals with concern faulty home repairs and cowboy builders, Matthew says.

‘We get a lot of claims about solar panels,’ he adds. ‘We also had a case recently where spray foam was put on the outside of a roof.’