What happens if Mothercare goes bust? What are your rights?

4/11/2019 Sad news today as Mothercare UK confirms it will enter administration.

The high street retailer has confirmed that it will be appointing administrators for its UK stores. If you’re worried about what this means for your rights, look no further. Whether you’ve got Mothercare gift cards or you’re worried about returning something to Mothercare, here are your rights!

Mothercare UK is the latest in a long line of retailers to go bust. 43 brands went bust last year alone, closing 2,549 stores.

You can’t ever guarantee that a firm won’t go bust, but here’s a few simple tips on how to shop so you’ve got more rights.

Vouchers and gift cards

If a firm goes bust, then often vouchers you may have with them become invalid. They are generally treated as cash you are owed. Some firms that have gone in to administration have honoured their vouchers. But if you hear rumours that a business is in trouble, don’t delay – use your vouchers and gift cards before it’s too late. If you have Mothercare gift cards and vouchers, it’s best to cash them in as soon as possible!

Repairs and refunds

If you’ve bought something that doesn’t work but the retailer goes bust, you’ll need to go to the manufacturer to see if you can get a repair, replacement or refund. If you’ve not received your goods then ask for a ‘chargeback’ from your card provider urgently.

If you’re worried you’ve been stitched up by a dodgy retailer, speak to your local Trading Standards officer – they’re based in the council offices. They can let you know if there’s a wider problem and can investigate the business if they think there’s a cause for concern.

The best way you can protect yourself is to keep your eye on the news. If it sounds like a firm is in trouble contact them asap. But act quickly – it’s the best way to safeguard your hard-earned cash.

Pay by credit card

You’ve got lots of statutory protection if you pay for goods or services using a credit card. There’s a nifty law called the Consumer Credit Act that says if you pay for things on a card that cost over £100 and less than £30,000 you could claim the money back from the card provider. You don’t even need to have spent the whole amount on the card as long as the deposit falls within the limits. This is known as making a claim under ‘section 75’.

Failing that, pay by debit card.

It’s not a legal right, but the card providers run a scheme called ‘chargeback’ which means you might be able to ask them to recall your money if there’s a problem. But act quickly. If a firm goes bust it may be too late. Using electronic money services like PayPal also gives you some rights, but read the dispute resolution rules first.

Avoid paying by cash, cheque or direct transfer

You’ve got no rights to recall your money if this happens. Always question businesses that ask for payments this way and don’t pay if you can’t afford to lose it.