PayPal, Klarna and other payment processors

The "chain" problem

Section 75 needs a debtor–creditor–supplier link: you, your card provider and the supplier. When PayPal sits in the middle, your card provider paid PayPal, not the merchant, so many issuers say Section 75 doesn't apply. The Financial Ombudsman Service has generally taken the view that the link is broken in standard PayPal payments, though each case is assessed on its facts.

Use the processor's own protection first

PayPal Buyer Protection has its own time limits (commonly 180 days to open a dispute — check PayPal's current terms). Opening a dispute there is usually the quickest route.

Chargeback is still possible

You can often ask your card issuer for a chargeback on the payment to the processor, though outcomes vary.

Buy now, pay later

Buy-now-pay-later products have historically been unregulated in many cases, meaning Section 75 may not apply. UK regulation of these products is being introduced — check the provider's own dispute policy and current FCA guidance.