Over recent months there has been a substantial surge in the number of small traders and other businesses that have gone bankrupt and there is little doubt that over the next 12 months many others will follow in their footsteps.
Figures released at the end of October show that the number of people suffering from the effects of insolvency have increased from 1600 to 4100 in just six months. For small business people the numbers are considerably worse with many sole traders and companies on the fast track to administration or receivership and bankruptcy.
The reason that this is a potential minefield for ordinary people is that if a small business goes to the wall it can happen very suddenly and without any warning to their customers.
This could mean for example that you give a deposit to a shop for a wedding dress only to find two weeks later that the windows are covered in newspaper and your deposit is gone.
That kind of loss may be upsetting and annoying but in the big scheme of things it is not the financial end of the world. On the other hand if you are having some major work performed on your home losing your deposit could be a financial disaster.
This could be a relatively small item such as having a new bathroom fitted or perhaps something more major like the construction of a new extension. If you give a deposit and the builder cuts a huge hole in the back of your house destroys your kitchen begins building your extension and then promptly goes bankrupt you are left with out your building work completed and your deposit cash.
In these days when it is not just a slight possibility that someone who is supplying you with a major service could go out of business at any moment, it is essential to defend yourself whenever you are shopping for a major purchase.
The best way to defend yourself is wherever and whenever you can to make payment for major purchases and services with a credit card. There is a very simple reason for this it is called the Consumer Credit Act, and more specifically section 75 of the act which stipulates that if you do not receive any services or goods that you have paid for via credit card the issuer of the card must assist you in your pursuit of a refund.
Furthermore if it is not possible to recover your funds then the issuer of the credit card is legally obliged to fully compensate for your loss on any item that cost anything between £100 and £30,000.
So you can see the value of the security offered by making a purchase of a substantial nature with a credit card. You should always push to make any payments for high end goods and services with a card to give yourself the maximum possible protection under the law. |
