How to complain to Clearpay
Buy now pay later is the sector where the usual consumer protections are weakest, and it is worth knowing that before you complain. Interest-free instalment agreements have historically sat outside FCA regulation, which means section 75 does not apply and the Financial Ombudsman may not be able to help. The Government has legislated to bring the sector into FCA regulation, so check the position that applies to your agreement.
The rights that apply when you complain to Clearpay
Clearpay is a UK buy now pay later provider, so the rules below are the ones that decide your complaint. Each is named, because a letter that cites the specific rule is handled by a different team to one that does not.
- Your rights against the retailer are unaffected. If the goods were faulty, never arrived or were not as described, the Consumer Rights Act claim against the retailer is exactly the same as if you had paid by card. Consumer Rights Act 2015, sections 9 to 24
- Where a return has been accepted by the retailer, the instalment plan should be cancelled and any payments refunded. A provider continuing to collect after a confirmed return is collecting money it is not owed. Consumer Rights Act 2015 and general contract law
- If the provider took a payment after you withdrew authority, that is an unauthorised payment and your bank must refund it by the end of the next business day after you report it. Payment Services Regulations 2017, regulations 75 and 76
- Missed instalments can now be reported to UK credit reference agencies. If an entry on your file is inaccurate you can require it to be corrected, and you can add a notice of correction explaining a disputed entry. UK GDPR Article 16 and Data Protection Act 2018
- Where a collection agency chases a disputed balance, FCA rules on arrears and recovery apply to the agency even if they did not apply to the original agreement. FCA Handbook, CONC 7
The deadlines that decide your claim
Act before the next instalment
The practical deadline is the next collection date. Cancel the continuous payment authority with your bank if a disputed plan is still collecting, which you are entitled to do directly.
13 months — unauthorised payments
Report an unauthorised collection to your bank without undue delay and in any event within 13 months of the debit.
6 years — the contract claim
Six years in England, Wales and Northern Ireland, five in Scotland, for the underlying claim against the retailer.
What to put in the letter to Clearpay
Complaints teams work from a script. The detail below is what moves a case off that script and onto the desk of someone who can authorise a remedy.
- That your primary claim is against the retailer, with the order number and what went wrong, and that you are asking the provider to pause collections while it is resolved.
- The return tracking number and the retailer’s confirmation of receipt, which is what actually unlocks a cancelled plan.
- A request for the provider’s final response letter and confirmation of whether the agreement is a regulated credit agreement, because that determines your ombudsman rights.
- Where a credit file entry has been made, a request that it is suppressed while the dispute is open.
If Clearpay says no, or says nothing
Escalate to the Financial Ombudsman Service, where the agreement falls within its jurisdiction.
When you can go: Ask the provider for a final response letter. It must tell you whether you have ombudsman rights. Where it does not, the fallback is a chargeback through your bank or a claim against the retailer.
How long you have: Six months from a final response letter where ombudsman rights apply.
What it costs: Free to you.
Whether it binds Clearpay: Binding on the firm if you accept the decision and the case is in jurisdiction.
Worth knowing before you start
This is the honest weakness in buy now pay later. Section 75 of the Consumer Credit Act does not apply to an exempt interest-free agreement, so you cannot make the provider jointly liable for the retailer’s failure the way you can with a credit card. Your strongest position is almost always the claim against the retailer itself, backed by a chargeback on the card you funded the instalments from.
Common questions
Does section 75 protect a buy now pay later purchase?
Generally not. Section 75 of the Consumer Credit Act 1974 attaches to regulated credit agreements, and interest-free fixed-instalment buy now pay later has historically been exempt under article 60F(2) of the Regulated Activities Order. That exemption is why the protection does not follow. The Government has legislated to bring the sector under FCA regulation, so check the FCA’s current position for your agreement. In the meantime, direct your claim at the retailer and use chargeback on the card funding the instalments.
I returned the goods but the provider is still taking payments. What do I do?
Two things at once. Send the provider the retailer’s confirmation of receipt and ask for the plan to be cancelled and payments refunded. Separately, instruct your bank to cancel the continuous payment authority, which you are entitled to do directly under the Payment Services Regulations 2017 without the provider’s agreement. Any payment taken after you withdraw authority is unauthorised and must be refunded by the end of the next business day after you report it.
Will a missed buy now pay later payment hurt my credit file?
It can. The major providers now report use and missed payments to UK credit reference agencies. If an entry is factually wrong, you can require correction under Article 16 of the UK GDPR by writing to the credit reference agency and to the provider. Where the entry is disputed rather than plainly wrong, you can add a notice of correction to your file, which lenders see.
Can the Financial Ombudsman look at my complaint?
It depends on the specific product. Some products offered by these firms are regulated and carry ombudsman rights, others are exempt and do not. The reliable way to find out is to ask the provider for a final response letter. A firm issuing a final response on a regulated matter must tell you about your right to refer it to the Financial Ombudsman and must enclose the ombudsman’s leaflet. If no such rights are mentioned, treat the retailer claim and chargeback as your route.
Where this comes from
Every rule on this page is drawn from primary legislation, a regulator, or an approved dispute resolution scheme. Check them yourself.
- FCA: buy now pay later
- Financial Ombudsman Service
- Consumer Rights Act 2015
- Payment Services Regulations 2017
Paybacker is not a law firm and this is not legal advice. It is a summary of the published rules that apply to a buy now pay later provider, so that you can put your own case properly. For a dispute of real value, or anything turning on facts unique to you, speak to a solicitor or Citizens Advice.
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