Finance Globe

U.S. financial and economic topics from several finance writers.
3 minutes reading time (540 words)

When a Merchant Incorrectly Charges Your Card

When we use our credit cards, we trust the businesses swiping our cards to charge the correct amount. But, don’t get so comfortable that you forget to check your credit card statement to confirm that the amount on your statement matches what you were supposed to be charged. A finger slip or computer glitch could lead to inaccurate charges on your billing statement. Don’t panic if you spot these. If you act quickly, you can take care of it.

It’s a good idea to keep receipts from your credit card purchases at least until you receive the billing statement listing that purchase. Then, when you receive your statement, you can compare the charges to your receipts. If the numbers don’t match, your receipt will come in handy in helping you clear up the overcharge. Otherwise, it's probably safe to toss or shred the receipts.

Before you do anything about an overcharge, make sure an actual charge has gone through. With some purchases, the merchant will put an authorization hold on a portion of your available credit. For example, a car rental agency may out a hold on your funds until you’ve returned the vehicle. You’ll typically see this on your online transaction history, not your actual billing statement. Wait a few days after you’ve completed the transaction, e.g. turned in the rental car, the authorization hold should be lifted and the correct amount should appear in your transaction history and on your billing statement.

Start by contacting the business that charged you incorrectly. Let them know your credit card statement contains an inaccurate charge. While they can’t necessarily remove the charge from your current statement, they may be able to issue a refund in the difference or refund the entire amount and charge you for the correct amount. Make sure to show your receipt as proof.

If the merchant can’t or won’t help you clear up the charges, you can go to your credit card issuer to clear up the issue. Act quickly; you only have 60 days from the date the billing statement was mailed to submit a dispute to your credit card issuer. Make the dispute in writing and include a copy of your receipt to help your claim.

The good thing about disputing with your credit card issuer is that you’re not required to pay the disputed charges until it’s been cleared up with the merchant. You won’t be charged interest or penalized for withholding payment, but that only for the amount you’ve disputed. If you have a balance that includes charges you haven’t disputed, you’re required to make at least the minimum payment.

Once the creditor receives your dispute, they’ll first send an acknowledgment of the dispute. Then, within 90 days the investigation must be resolved. It may happen quicker than that.

This protection is one of the reasons it’s better to use a credit card rather than a debit card. With a debit card, a transaction in the wrong amount can potentially wipe out your bank account. And you’ll have to fight to get the money put back in your account. On the other hand, the law for inaccurate credit card transactions protects your liability for charges you didn’t make.

Source: Fair Credit Billing Act
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Big Balances Can Be Big Trouble
 

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Wednesday, 23 October 2019

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