Your right to a credit card refund

July 13 2009 by Ellen Roseman

If a store closes its doors, you don’t want to be out of pocket if you have paid for merchandise and not received it. You can protect yourself by putting down a small deposit and using a credit card, rather than cash or a debit card.

I recently wrote about Neoset, a Toronto furniture chain that sold custom-made furniture from Greece and Quebec. Customers were given endless excuses for why their orders hadn’t arrived. Then, one day, the stores were shuttered and the phone lines went dead.

In my column, I said Visa and MasterCard could provide refunds when items were paid for and not delivered. Both have policies that ensure customers are made whole in such cases.

Then, I started getting complaints that people were being denied refunds. Their credit card issuers said they were out of luck because they had a limited window of only 60 or 90 days after payment to get their money back.

This is not true. The financial institutions that issue credit cards are getting the facts wrong. They’re misinterpreting the generous refund policies designed to help consumers caught in a retail crunch.

So, let’s get the story straight. Here’s a quote from Julie Wilson, a spokeswoman for MasterCard Canada, and reiterated by Amy Cole, a spokeswoman for Visa Canada:

MasterCard provides its card issuers with 120 days from the latest anticipated delivery date to dispute a charge. Simply put, it is non-receipt of merchandise.

Similar to the airlines, if a merchant goes out of business, and you have used your MasterCard credit card, then you are covered on any services or products not received. That includes deposits.

So if you have purchased a wedding gift using a registry, and the goods were never received, then your card-issuing financial institution would have 120 days from the date that you were told it would be delivered to dispute the charge.

Let’s say I bought something on April 3, 2009 and the merchant tells me that I will have it in my hands on Oct. 2, 2009. The 120 days starts Oct. 2, 2009.

It’s important to keep receipts and records of any communication about delivery dates. Then, if your credit card issuer says no, keep fighting up the chain. Go tol the head office of Visa or MasterCard for confirmation that a refund is allowed.

I predict we’ll see more cases of business failure and non-delivery of orders before this recesssion ends. If credit cards want to maintain their reputation as being more secure than cash, they had better train their issuers to tell the truth about their refund policies.


  1. SF

    Jul 13 2009

    I prefer to support local businesses, so when I was purchasing bedroom furniture I dealt with Neoset in Newmarket.

    My first mistake was not reading the fine print in their contract. I gave them a 50% down payment for 2 cupboards which were designed to accommodate 2 racks of clothing (one upper and one lower) by their “designer”.

    When the closets were delivered, it was immediately obvious that there was no way that 2 racks would fit. The workmanship was shoddy and the installers were incompetent.

    I went in to the store to talk to the manager and to tell him that I would not pay the remaining 50% until I was satisfied with the product. He laughed and showed me the contract, which said that the remaining 50% would be charged to my Visa 2 days before delivery!!!

    I was very upset and he asked me to leave. After an attempt by a competent installer to correct the problem, he said that the design was incorrect and should never have been approved by head office.

    I tried to contact the store and head office to remove the cupboards and give me my money back. Although I tried to contact them by email, fax and special delivery, I never heard back from either.

    I decided that the only way that I would get satisfaction was through small claims court – again Neoset had the audacity to ignore the courts!! The entire episode was very stressful and frustrating.

    I wonder if Visa can do anything in this case. By the sounds of your article, I was not the only person who was treated poorly by this company – it is a wonder that they had been in business this long.

  2. Brett

    Jan 14 2015

    I recently had an issue where I waited for almost 2.5 years for a product to be delivered. The company finally decided to say they would not deliver.

    When I approached Visa, they initially tried to help. Later they said that since the original purchase was over 520 days in the past, they would not be able to help out.

    Is that legit?

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