Christmas Shopping Online: Avoiding Payment Pitfalls and Knowing Our Rights

The way we interact with retailers and other traders has changed considerably over the course of the last few years.

With many of us turning to online shopping out of necessity during the pandemic, and continuing to do so now, many high street retailers have reduced the number of physical stores they have as a result, moving primarily online.

With the current cost-of-living crisis and increasing energy costs placing additional pressure on us to watch the pennies, it is more important than ever for us to be aware of our consumer rights.

With any purchase decision, it is always best to weigh up the positives and negatives to understand how we can better protect ourselves should something go wrong. We’ve laid out the benefits vs the drawbacks of online shopping below.


Benefits of Online Shopping

Convenience – The main benefit of shopping online (and why most of us choose to do it) is convenience. You can shop at any time of the day or night without leaving your home and you can visit multiple websites in a short time period, making it easier to shop around to find the best price.

Cheaper – Some online retailers have lower prices than what is on offer instore, many offering deals to online shoppers. Some may also offer online-only discounts, or free / reduced price delivery. It is important to check what delivery will cost and any exclusions to this (remote and rural areas, etc)

Returns – When you buy goods online you have 14 days to return them for a full refund (you may have to cover the return postage costs unless the goods are damaged / faulty). There are some types of goods where this doesn’t apply, including items that have been made to order; online games, apps, or other downloads; items where there could be hygiene issues (such as underwear or earrings); and anything that has a short life span such as flowers or food.

Payment – Traders are more likely to accept payment by credit card, debit card or PayPal, this can give you extra protection if something goes wrong (we will cover more about the different payment methods shortly).


Potential Drawbacks of Shopping Online


Delivery (Timescales and costs) – You should always check what the trader’s timescale for delivery is. Unless the trader has specified that you’ll receive the goods by a certain date then they have up to 30 days to deliver them to you, this might not be convenient if you need something quickly.

Overseas Traders – If you buy something from an online trader who isn’t based in the UK, then it can be more difficult to get problems fixed should something go wrong. You should always check that there is a postal address on the website you are buying from, so that you know where the trader is based, domain names don’t guarantee the trader is based in the UK.

Counterfeit Goods – As you can’t physically inspect the goods before purchase, there can be higher risk of accidentally buying counterfeit goods. If you haven’t ordered from a trader before its best practice to check for reviews from previous customers and to pay using a credit or debit card so that you’ll have additional protection if something goes wrong, looking out for repetitive reviews with similar language (this can be a sign of fake reviews and sometimes scams).


Pause for Thought: How We Pay

The way we pay for goods and services has changed a lot over the years and while some of us still use cash, other methods may offer additional protection if something goes wrong. Again, by understanding the financial products we use and the recourse we have should something go wrong, we can place ourselves in the best position possible this festive season.

Debit card

Some debit card providers operate a Chargeback scheme where you can ask them to reverse the payment should something go wrong. For example, if the trader fails to deliver goods. It is always a good idea to check with your bank or card provider the terms and conditions of accounts; and how you will be protected for purchases should something go wrong.

Credit card

Payments are protected by Section 75 of Consumer Credit Act 1974 which makes your card provider jointly liable with the trader to refund you if something goes wrong. Only goods or services valued between £100 and £30,000 are covered by this, but you can make a claim even if you only paid 1p towards the purchase on the card. This is useful for purchasing high value items, but you should try to pay the card off as soon as possible to avoid high interest rates.

Purchases under £100 made on a credit card are also protected by the Chargeback scheme.


There are different types of finance available including hire purchase, conditional sale agreements and fixed sum loans and they tend to be useful for buying high value items such as cars or furniture. Some types of finance will give you the option to hold the finance company liable if something goes wrong and you can’t resolve it with the trader. You should always check the rate of interest and what the total amount payable will be. Some finance products offer 0% interest for a period of time but once this ends the rate of interest can be high, so if you can it is best to pay the balance in full before this.

Direct debits 

Direct debits are used for making regular payments for services such mobile phones, TV, and internet services. Customers are protected by the Direct Debit Guarantee and if a payment is taken incorrectly then your bank or building society have an obligation to refund the payment.

Gift Card / Vouchers

These are generally used for giving gifts instead of cash, you decide how much you want to load onto the card and the recipient can then only spend to that amount. They provide no additional protection if something goes wrong.

You should beware of anyone asking you to make a payment by gift cards such as for iTunes, as this can indicate potential scams. Additionally, it is important to keep an eye on expiration dates of vouchers. It is a good idea to read the small print and terms and conditions before making purchases in this way.

PayPal / Sage Pay

Both of these methods of payment offer secure services that allow you to send electronic payments online. PayPal also offer a process where you can raise a dispute against a trader although there is usually a time limit in which to do so.

Digital Wallets (Apple / Google Pay)

These allow you to make secure electronic payments online or in person if you have a device that supports it, such as a mobile phone, smart watch or tablet. As your credit or debit card is linked to the digital wallet, you may also be protected by section 75 or chargeback schemes, depending on the type of account you have.

Bank transfers

Bank transfers are a direct transfer of an amount of money from one bank account to another. Scammers will often ask for payments to be made using bank transfer, as this often allows them faster access to the money. While there is no obligation for them to do so, if you have been the victim of a scam, you can ask your bank for help in getting the payment back if made by transfer.

Store cards

Store cards are a credit facility offered by some retailers. It is important to check interest rates and potential charges for late or missed payments as these can be a lot higher than other methods of payment. This information can be found on retailer websites and in terms and conditions of credit agreements.

Buy-Now-Pay Later Products

There are now financial products often linked to retailer websites, allowing the cost to be spread over regular payments, sometimes interest free. It is important to remember, that although convenient, not clearing the balance of this type of financial product before the end of the interest-free period can mean that ‘deferred’ interest is added on. This is the interest ‘backdated’ for the period that you had the product. This can also make store cards a more costly way of paying for purchases.

There are things that we can bear in mind when shopping online to ensure that we are making the most of our money and protecting our consumer rights should something go wrong.

Advice Direct Scotland have put together some of our top tips for avoiding the pitfalls and protecting our rights this Festive Season – 

  • Shop around –there may be other websites that offer the same products for less. By checking prices with other retailers, you can save money. There are price comparison websites that can do this for you but remember that these sites may be biased towards a specific brand or retailer.

  • Check websites for price matching –some of the larger retailers may offer to match prices of smaller websites. Not only will you get a better deal on the item you are purchasing, but you will also have the additional peace of mind of purchasing from an established retailer.

  • Purchase on a credit card –If you are purchasing more expensive items do this on a credit card (even if you pay it off straight away) – Section 75 of the Consumer Credit Act offers additional protections on purchases over £100 (but under £30,000). This makes the card provider liable ‘joint and severally’ for the purchase, meaning that if something goes wrong, you have an additional route for recourse. This also applies if you have only paid for part of the purchase in this way.

  • You have more rights online than in store – Consumer Contracts Regulations mean that you have the right to return most goods purchased online within fourteen days for a full refund (even if you just change your mind). This refund includes the delivery costs in the case of damaged / faulty goods.

  • Check for offers on free delivery – Sometimes by spending slightly more, you can save. Check for offers on free delivery when you spend over a certain amount, but don’t be drawn into spending money for the sake of it – if you are close to the amount, purchasing another low-priced item (that you need) may remove the cost of delivery.

  • Signing up to website newsletters can save you money –Some retailers offer initial discounts, or reductions on subsequent purchases. Be careful that your information will be safe and ensure that you check for any ‘opt-out’ boxes to ensure that your details are not sold to third parties, and you don’t receive ‘spam’ emails.

  • Check retailer websites for online sales events –By holding off on purchasing (even for a couple of days), you can save money on products when they go on sale.

  • Check for discounts relevant to you– Does the retailer offer discounts for students, or career-based discounts? Check before making purchases.

  • Make the most of retailer loyalty schemes – Using retailer points-based loyalty cards can earn you money back at the till, as well as discounts and member-only sales, events, and deals. Most of these are free to sign up to as well.

Advice Direct Scotland is running our ‘Countdown to Christmas’ campaign through the festive season. This is focusing on the things we can do to save money this festive season. For more information, visit

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