Research by the Telegraph shows many providers either stick to the strict legal position or they have been unwilling to give us an assurance that they would use the charge-back system offered by Paypal. They include: Citibank, Clydesdale, Egg, Goldfish, Leeds Building Society, Morgan Stanley, Nationwide, Post Office and Yorkshire Bank. All the other major credit card issuers said they would reclaim customer's money in the case of a valid dispute.
If you are using a service other than Paypal you may encounter difficulties in getting help from most credit card providers. M&S Money said: "Paypal enable us to chargeback from a supplier's bank, so that is the system we use. However, we do not treat purchases made via other payment services as a standard purchase because the transactions are related to the transfer of money and not the purchase of goods."
Because there is no "credit" involved in the use of a debit card, purchases using debit cards are not covered by the Consumer Credit Act and therefore Section 75 does not apply. However, the rules governing Visa debit cards allow banks, on behalf of their cardholders, "to seek financial redress from the merchant's bank if the cardholder has bought goods or services that will not be delivered, for example when a merchant ceases trading."
Similar arrangements are available with some other debit cards but the following providers said they would be unable to provide a charge-back facility: Bank of Ireland, Clydesdale, First Direct, HSBC and Yorkshire Bank.
HBoS which issues Bank of Scotland, Intelligent Finance and Halifax branded debit cards, said: "Our policy is to investigate any claim that a customer makes where they have been unable to resolve a problem directly with the retailer." It said the aim would be to refund the customer.
HBoS said: "We make hundreds of such refunds every month. We want our customers to feel secure about using their credit and debit cards, although we would still urge sensible caution - including checking out any company you are dealing with over the internet."
When buying anything, whether online or on the high street, paying by credit card gives you extra legal rights if something subsequently goes wrong with your purchase.
Paypal offers more protection than other online payment systems because the company has both an internal disputes system for purchases worth up to £500 and a charge-back "safety net" arrangement where valid claims are made by credit and debit card issuers
The following credit cards told the Telegraph they will support a valid claim by using the charge-back system offered by Paypal: American Express, Barclaycard, Bank of Scotland, Britannia, Capital One, Co-op, First Direct, Halifax, HSBC, Intelligent Finance, Liverpool Victoria, Lloyds TSB, Marks and Spencer, MBNA (including various charity and other affiliated cards), Mint, NatWest, Northern Rock, Norwich & Peterborough, RBS, Saga, Sainsbury's, Smile, Tesco, Virgin and Yorkshire Building Society
Using payment service companies other than Paypal may leave you having to pursue redress with no support from the credit card company.
The following debit cards will support a valid claim by using charge-back systems for all purchases: Abbey, Alliance & Leicester, Bank of Scotland, Barclays, Citibank, Co-op, Coventry Building Society, Halifax, Intelligent Finance, Lloyds TSB, Nationwide, NatWest, RBS and Smile.
All card issuers suggest you should try to sort any dispute out with the provider of the goods or services before taking the matter up with them. Unfortunately, in practice, some are still not helpful even when you have done this. If a card company is not helping you in the way they have indicated they will, please contact The Telegraph at money @ telegraph. co. uk