By Mike Kienlen, Head of Restructuring, Recovery and Insolvency, Armstrong Watson

I WAS very sad to hear last week the news of the liquidation of Thomas Cook with the mammoth loss of thousands of jobs and the continuing disruption, cancellation and upset to hundreds of thousands of holiday goers.

Whilst ATOL protection for many of those who booked holidays through registered travel agents will look to cover losses for the travel and accommodation covered under the policy, this dire situation also reminds us of the protection offered when paying by credit card.

Under the Consumer Credit Act, your credit card provider must protect any purchases made over £100 for free – so if there’s a problem there’s a good chance you can claim your money back!

‘Section 75’ of the Act offers fantastic protection and means should you order something and the supplier then enters an insolvency process, you can still claim your money back from the credit card provider. It applies to most, but not all, credit card agreements. Not only that, credit cards are the main area covered, but the law also applies to store cards, store instalment credit and some car finance agreements (though not hire purchase).

Also, keep this in mind in the run up to Christmas when buying gifts and gift vouchers, with the continuing uncertainty on the high street, and the unknown effects of Brexit looming, payment by credit card can go some way to provide you with protection and peace of mind.

One word of warning however, you may not get the Section 75 protection if you use your credit card for PayPal purchases as it is one of the third-party firms that will often – though not always – scupper your Section 75 rights!

Armstrong Watson’s Restructuring, Recovery and Insolvency team offer support and advice to businesses facing difficult times. If you are concerned about the security of your business and the challenges it may be facing please give a member of our specialist team of advisers a call on 0113 2211 300 or email