News, Culture & Society

Can I claim for cryptocurrency losses with Section 75?

A number of credit card providers have put blocks on customers buying cryptocurrencies on plastic in recent weeks.

Lloyds – which also owns MBNA – became the latest to ban these transactions this week, explaining that it took the measure to ‘protect’ its clients. 

The move came as bitcoin crashed from an all-time high of $20,000 in December to below $6,000 on Tuesday.

However, it has denied to This is Money claims it took the step after a glut of customers contacting providers attempting to claim on Section 75, a piece of consumer protection available on credit card purchases over £100.

Lloyds ban: The bank said Bank of Scotland, Lloyds and MBNA credit card customers could no longer buy cryptocurrencies on plastic

This is Money put the question to Lloyds after claims emerged alleging credit card providers had been deluged with refund requests from customers who had lost out when their holdings plummeted in value.

Website CryptoGo claimed that some customers had become aware that ‘using credit cards to pay for crypto transactions were insured for purchases’.

The website adds that it believes: ‘Banks’ credit card protection for purchases helps customers get a full refund but with so many wild card tactics out there, they were set to lose billions.’ 

It said: ‘Credit card payment protection is completely free and comes automatically with every credit card – meaning the banks felt they were on dodgy ground, word spread like wild fire and it was enforced across the city like lightening.’ 

Furthermore, on social media website Twitter, an investor Kevin Allen claims: ‘Exchanges selling crypto as an investment informed individuals using exchanges knowing if their “investment” loses they can claim false misrepresentation.

‘These people are smart, knowing S75 gives them a one way bet.’

Bitcoin boom: The price is volatile and some may have seen heavy losses, if they bought into the digital currency in mid-December.

Bitcoin boom: The price is volatile and some may have seen heavy losses, if they bought into the digital currency in mid-December.

We put the claims about Section 75 to Lloyds Banking Group. 

We asked if a customer could attempt a Section 75 claimback for cryptocurrency and whether there had been a large number of attempts to do so.

We also asked whether a customer, who went to buy bitcoin with a credit card on a dodgy website, could use Section 75 if they are defrauded or do not receive the crypto in question. 

A Lloyds Banking Group spokesman told This is Money: ‘A Section 75 claim makes the credit card company jointly liable for any breach of contract or misrepresentation by the retailer or trader. 

‘Unless that breach of contract was apparent therefore, a Section 75 claim wouldn’t be possible for a consumer who had purchased a cryptocurrency.’ 

The banking giant said it has seen some credit card customers call about using Section 75 for crypto buys, but the coverage is not applicable if someone has bought into a digital currency and it has simply fallen in value.


The price of bitcoin has yo-yo’d this week. It hit a weekly high of $9,400 on 3 February, before falling as low as $5,900 on 6 February, data from Coindesk shows.

Today, it sits at $8,200, still way below the peak of nearly $20,000 reached on 16 December. 

This kind of volatility may be what is worrying credit card providers. 

It says the rise in calls about it hasn’t been huge, unlike the claims made above.

It says coverage is not applicable because cryptocurrency is likely to have been bought and received as promised – and thus, it is not covered.

However, for those who have been defrauded by entering details on a dodgy website or didn’t receive the digital currency they were trying to buy as promised, they will look into the ‘nuances’ of the case.

It might not be Section 75 that is used, it says, but something else to help a customer get their money back. 

Bitcoin and other cryptocurrencies are notoriously volatile. Bitcoin, the most familiar of the digital currencies, has bounced back to $8,500 today.

These swings are making credit card providers nervous. 

Capital One had already made the same move a month previous, while Virgin Money said it was doing something similar in the wake of the Lloyds announcement. 

Furthermore, in the US, a number of others have blocked credit card crypto buys, including the Bank of America, Citigroup and JP Morgan.

Some other British based banks have also said they are keeping an eye on the situation, including Santander.

While those that have blocked buys say it is protect customers, there are other transactions which similarly can lose money – the most obvious example is gambling on sporting events, lotteries or at casinos.

Credit card transactions are not typically blocked for this type of activity – although many charge extra to do so, typically a three per cent fee.

For example, Halifax started charging a £3 fee to credit card customers who play the Lotto in the summer of 2016, as it treats it as gambling. It varies from provider to provider. 

The argument could be made with cryptocurrencies that people are lumping speculative investments onto a credit card, lose heavily and then not have the means to pay it back.

But again, this already happens with a whole range of purchases, from white goods to holidays. 

Given the ban has only been put on credit card purchases – not debit card, or bank transfers, providers may be worried about the stronger consumer protection credit cards offer. 

On purchases on a credit card of more than £100, under Section 75 the provider of credit is equally liable with the provider of goods or services in cases where there has been misrepresentation or a breach of contract.

It removes the risk that people could be put into debt for goods or services that weren’t received at all, were faulty, or were otherwise not as described. 

Now this is interesting because consumers, stung by cryptocurrency problems, may theoretically have a case – but it is a grey area, given the sudden boom in crypto interest. 


Have you bought crypto on credit card and attempted a Section 75 claimback?

Do you work in a bank and have seen a rise in customers trying to claim under Section 75 for crypto buys?

Get in touch: 

Put simply, most credit card providers do not have crypto buys written into their terms and conditions.  

It something goes wrong with a purchase, the responsibility of reimbursing a consumer with the loss is with both the retailer who sold the goods or services.

Many crypto exchanges are based abroad – but Section 75 also applies to foreign transactions and goods bought online.

Credit card providers could potentially be on the hook if a cryptocurrency exchange went bust or a customer is defrauded by a phony website.

In terms of huge losses, a consumer could argue that wherever they bought their digital currency from ‘misrepresented’ the investment in question – but we reckon that would be much tougher to prove. 


Find out how bitcoin and the blockchain works, so that you have some understanding of the system, the ledger, the major players and the public and private key elements.

Remember bitcoin yields nothing and its main source of value is scarcity. Most bitcoin activity is trading not investing. 

Research coin wallets, the digital vaults where cryptocurrency is held, and consider security carefully. Bitcoins have been stolen before, understand how this happened.

Be prepared for extreme volatility. The price can move by 20 per cent in one day and you could easily lose half of your cash in a far quicker time that investing in the stock market.

Consider how you would cash in any gains. There are reports that this has proved hard for some people. A time of market stress could lead to people being locked in and unable to trade.

Read our guide to How to be a successful investor, which looks at the far less high octane world of long-term investing and how to make it a success. 

What is bitcoin?

The digital currency that most will be familiar with is free from government interference and can be shared instantly online. It doesn’t rely on trusting one central monetary authority.

The underlying technology is blockchain, a financial ledger maintained by a network of computers that can track the movement of any asset without the need for a central regulator.