Why credit cards are great to use online

You're standing in the queue at the shop about to hand over £30 following your latest adventure to the CD and DVD shelves. Do you typically hand over cash, use your debit card or use a credit card to pay ?

According to the UK payments association, APACS, you are most likely to use your debit card. Last year, spending on plastic, at £273 billion, exceeded cash spending (£272 billion) for the first time ever and debit cards accounted for 65% of all plastic card purchases.

When you buy your goods online using one of the best credit cards, however, and you're more likely to use a credit card. Last year credit card spending accounted for 72% of all online transactions. Why could that be?

APACS suggest it's because people feel safer using credit cards online. It's much clearer to check a credit card statement for spending online than it is to check a current account statement which will list all your direct debits, standing orders, and cash withdrawls. And it seems people are becoming more aware of the protection against lost, stolen or damaged goods that making use of a credit card can offer.

Section 75 of the Consumer Credit Act states that when you purchase something using a credit card online or otherwise, your contract is with both the shop / trader and the card issuer as well. The card issuer therefore has equal liability for anything that goes wrong so if you have trouble sorting out a problem with the shop / trader you can start action against the card issuer to get a resolution which will most likely be a refund. The Act is restricted to goods sold for more than £100 and less than £30,000, but it's useful in situations where, for example, the trader goes bust and if you purchased with cash you would be stuck.

Section 75 covers everyone using a credit card but its not surprising to know that card issuers don't go out of their way to let you make you aware you have this extra protection. In fact, you might even have to fight quite hard to enforce your rights with some companies. You should persevere if you know you're in the right.

In any case, take note of the following advice:

• Keep copies of your credit card statements in case you need proof of the amount you paid.
• If you need to make a claim, you must approach the supplier of the goods first
• If this fails, contact the card issuer in writing and don't be put off if you initially get a negative response, remember to persist.

Be aware that debit and charge cards are not covered by the legislation so, when you buy something for more than £100, make sure you use your credit card to do it. The credit card protection makes it worth it.