Not upheld: refund handling, complaint response delay, Section 75 claim processing complaint against PayPal UK Ltd

Decision detail

Summary

Mr K purchased defective goods for approximately £900 in April 2025 using PayPal credit and requested a refund in August 2025. PayPal declined the claim under its Buyer Protection Program as the 30-day dispute deadline had passed. Mr K then raised a complaint citing Section 75 Consumer Credit Act rights, but PayPal took nearly two months to respond and request evidence of breach of contract. The ombudsman found PayPal's delay unreasonable but its information request justified, and determined that the £100 compensation already paid plus PayPal's offer to reconsider the Section 75 claim upon receipt of information adequately resolved the complaint.

The Ombudsman's reasoning

The ombudsman found that while PayPal's Buyer Protection Program has a 30-day deadline which Mr K missed, this did not prevent consideration of a Section 75 claim under consumer credit law. The delay of nearly two months in responding to Mr K's Section 75 request was unreasonable and caused inconvenience. However, PayPal's request for evidence of breach of contract or misrepresentation was reasonable, as the burden of proof lies with the claimant. The message requesting information was sent to Mr K, and PayPal remains willing to consider the Section 75 claim once information is provided. The £100 compensation already paid adequately addresses the avoidable distress and inconvenience caused by the delay.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website