Customer not entitled to refund without first returning defective vehicle

Categories:

Cards, Chargebacks,

Summary:

In August 2025, Andy used his debit card to pay part of the cost of a motor vehicle. He bought the vehicle from an overseas merchant. Andy found the vehicle was defective and asked the merchant for a refund. Dissatisfied with the response he received from the merchant, he asked the bank to make a chargeback request to the card company. The bank made the request, but the merchant's bank rejected it, saying Andy had not returned, or tried to return, the vehicle. The bank accepted this outcome and closed its file. Andy complained the bank had wrongly assessed the merchant's bank's response. He said the merchant would not accept the return of the vehicle unless he first withdrew his chargeback request.

Published:

November 2026

Our investigation

The card’s rules required Andy to return the vehicle, or genuinely attempt to return it, before a chargeback request could proceed. The correspondence between Andy and the merchant showed that, in December 2025, the merchant offered a full refund, which would occur once Andy returned the vehicle. Andy replied that he wanted the refund before he would release the vehicle. This condition contravened the card’s rules.

Evidence that emerged in January 2026 showed the merchant had refused to accept the return of the vehicle unless Andy withdrew his chargeback request. We did not agree with Andy that this showed a refusal on the part of the merchant to accept the return of the vehicle. The merchant had shown a willingness to accept the vehicle, including during a phone call in early January 2026. Had Andy returned the vehicle and the merchant then refused to refund his money, Andy would have been able to seek a chargeback on other valid grounds.

We were satisfied the bank made the chargeback request correctly and assessed the merchant's bank's response correctly.