Discover how credit card can protect purchases

Most cardholders overlook the fine print in their card agreements. By looking at this and understanding the fine print one, would be in a better position to decide whether to use the credit card, debit card or cash. If one has a problem in understanding or finds it difficult to read the dense print, all one has to do is to call customer service and enquire about the features of the credit card. Ensure that they give the whole checklist of features and benefits, which could be helpful in the future. Usually, these claims come with a deadline. So first find out about the deadline and the caps, as well as the amount that could be recovered per claim.

The most common protections are:

Generally credit card companies extend the warranty on purchases for a period of one year, but that depends on the original warranty and the terms given there. For instance, AmEx gives an extra 90-day warranty over and above the 90 days coverage that is given. So if the warranty is for 4 years, then the extended warranty would be for a year.

It is the cardholder who generally makes a claim. However, there are banks that allow the recipients of gifts to make claims. But to do so, one would have to have the original warranty and all the documents necessary, such as the receipt and a photocopy of the card statement etc. However, one must watch out for the warranty offered by the retail merchant or the manufacturer, as that might be much longer than that offered by the credit card company.

If an expensive purchase is made in one particular week, and the same product is available at a lesser price a couple of weeks later, then what can one do? In such cases, although the store might not be able to compensate, the credit card company will be able to credit back whatever the difference is into the cardholder's account. However, one has to carry proof of the lower price such as an advertisement or a sale circular. These rules don't apply for other discounts or closeout sales.

This warranty only lasts for about two months after making the purchase. This offers customers protection when there is no warranty and if the product is stolen or broken. Banks may replace the item or credit the amount spent back into the account but there is a cap on this amount.

Bryant Park

Bryant Park is a financial consultant for one of the companies listed on Wall Street. He writes on a variety of topics ranging from credit cards to different loans that can be availed by consumers. He holds a bachelor degree in Financial Services from Dartmouth College.