Not upheld: Card / payment disputes complaint against Barclays Bank UK PLC trading as Tesco Bank

Decision detail

Summary

Mrs V booked a hotel stay for approximately £68 through an online platform but immediately realised it was inconveniently located. When the platform refused a refund citing non-refundable booking terms, she disputed the transaction with Tesco Bank, claiming misrepresentation. Tesco Bank declined to raise a chargeback, explaining that the non-refundable terms and lack of evidence of misrepresentation meant the claim had no reasonable prospect of success under Mastercard rules. The ombudsman upheld Tesco Bank's decision, finding it acted fairly and reasonably in assessing the chargeback claim and that the payment amount fell below Section 75 Consumer Credit Act thresholds, making chargeback the only available remedy route.

The Ombudsman's reasoning

The ombudsman found that Tesco Bank was not obliged to raise a chargeback as there was no reasonable prospect of success. The payment was authorised by Mrs V, the booking terms clearly stated it was non-refundable, and there was insufficient evidence that the hotel was misrepresented regarding its location. Chargebacks are voluntary schemes under card issuer rules, not legal entitlements, and Tesco Bank acted fairly in declining to pursue a claim unlikely to succeed. The payment amount also fell below the Section 75 threshold, making chargeback the only available route.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website